Supreme Court Health Care Decision and Next StepsJune 30, 2015
With last week’s Supreme Court ruling upholding the Obama Administration’s interpretation of the Affordable Care Act (ACA), any prospect for fundamental change to the health care law before 2017 has largely been dashed. However, the hope for more targeted and practical reforms—which have largely been on hold in anticipation of the Court’s ruling—may have brightened somewhat.
NSBA has advocated modification or elimination of the onerous employer mandate, an end to the Health Insurance Tax (HIT), repeal of the medical device tax, and modification of the insurance rating rules, among other recommended reforms. But the one that could get the biggest near-term boost is one that puts states back in the driver’s seat in controlling the small group insurance markets: Protecting Affordable Coverage for Employees Act of 2015 (H.R. 1624).
Under ACA, rules governing small group health insurance plans will begin to cover groups of up to 100 employees in 2016. Previously governed by state law, small group rules have generally applied to employers with fewer than 50 employees. H.R. 1624 wisely gives states back the flexibility to decide whether to increase the small group size from 50 to 100 employees.
Actuarial studies suggest that many companies will see a significant increase in premiums once the small group size goes to 100 employees, particularly for companies that employ younger, healthier workforces. These premium spikes are likely to cause many of those companies to curtail coverage, drop coverage, or shift to a self-insurance option. Once those younger, healthier lives leave the small group fully-insured pool, premiums will rise further for those that remain.
In the aftermath of the Supreme Court ruling, NSBA will not give up the fight to enact common-sense reforms to ACA, in order to drive down costs and improve flexibility for small businesses struggling to provide health insurance.