The Division of Insurance announced Friday the Health and Human Services’ decision
The United States Health and Human Services (HHS) Secretary Kathleen Sebelius notified Governor Patrick last week that Massachusetts will have an additional year in which to comply fully with the Affordable Care Act (ACA). This means the Commonwealth also have an additional year in which the state’s health insurers may create specific insurance rates for the small group market using “rating factors” such as group size or industry. The Bay State now will have until 2017 in which to fully transition into the ACA’s requirements.
“I thank the Obama Administration for affording us this flexibility that will help our small businesses more smoothly transition into compliance with the Affordable Care Act,” said Governor Patrick. “The Commonwealth remains a national leader in health care coverage for our residents and we will continue working closely with our partners at the federal level to ensure the ACA is successfully implemented in Massachusetts.”
“The extended transition is good for our market,” added Insurance Commissioner Joseph G. Murphy. “The additional year will benefit our small employers and give them extra time to ensure that they are making the best insurance choices for their workers.”
In September 2013, Governor Patrick requested and received a three-year transition period for the state. According to the statement issued by the Division of Insurance, under the Affordable Care Act, all but four of the rating factors used to establish health insurance premiums in Massachusetts have been eliminated. The new rating factors under the Affordable Care Act now include age, geography, family size and tobacco status.
Industry, group size, participation rate, use of intermediary and membership in a group purchasing cooperative are now disallowed rating factors. As such, pursuant to the DOI’s announcement, the Commonwealth now has an additional year in which to phase out those disallowed rating factors. The result, says the DOI, will be an easier transition for small businesses and consumers across the Commonwealth.
