On Nov. 30, 2015, Insurance Commissioner Robertson issued Bulletin 221 regarding the definition of small group for purposes of providing employer health coverage. Indiana will continue to consider a small employer to be one who employs no more than 50 employees. There has been some confusion on how to count employees, so the department will issue an emergency rule to conform Indiana’s definition of “employee” for determining group size to the federal definition.
The department will define an employee as individual employed by an employer but not an individual owner or partner. Part-time and seasonal employees should be counted. The new rule will apply to non-grandfathered, PPACA-compliant plans with an effective date on or after Jan. 1, 2016.
Further, Bulletin 221 explains that because of the Protecting Affordable Coverage for Employees (PACE) Act, Bulletin 215 is withdrawn. Bulletin 2015 was issued June 4, 2015 (addressed in the June 30, 2015 edition of Compliance Corner), and allowed for transitional policies for employers with 51-100 employees to continue through renewal no later than Oct. 1, 2016. Those policies will not be considered transitional and will continue to be large group policies that may be renewed until Oct. 1, 2016. After that period, they must transition to a fully compliant policy.
Finally, another calculation affected by group size is MLR. The department considers groups of one to 100 employees to be a small group for purposes of calculating MLR. This policy will not change through the end of 2015. For plan years beginning before Jan. 1, 2016, premium rebate requirements of the ACA continue to apply in the small group market in Indiana only if the MLR is less than 80 percent. For plan years beginning on or after Jan. 1, 2016, groups of 51 or more employees will be considered large groups for purposes of calculating MLR.
Additional questions and examples are available within a small group FAQ found on the department’s website.
Bulletin 221 - Small Employer Definition »