Insights

Definition of "Small Employer" for Medical Loss Ratio Purposes


On Jan. 26, 2018, the Louisiana Department of Insurance issued Bulletin 2018-03. This Bulletin rescinded Bulletin 2011-03, which defined the term “small employer” for purposes of determining the medical loss ratio (MLR) under ACA. Under the previous definition, small employers were those who employed an average of at least one but not more than 100 employees during the preceding calendar year, and at least one employee on the first day of the plan year. This amended Louisiana law to line it up with ACA.

This bulletin changes the definition for MLR purposes to recognize small employers as those who employed an average of at least one but not more than 50 employees during the preceding calendar year, and at least one employee on the first day of the plan year. This change comes as a result of the Protecting Affordable Coverage for Employees (PACE) Act, which amended the definition of “small employer” under the ACA.

Although this bulletin doesn’t directly impact Louisiana-based employers, such employers should remain abreast of these changes under Louisiana law (as they’ll determine how insurers administer fully insured plans).

Bulletin 2018-03 »