Massachusetts Granted Additional Year to Help Small Businesses, Consumers Transition to ACA Compliance
BOSTON - Thursday, April 24, 2014 - Governor Deval Patrick was today informed by United States Health and Human Services (HHS) Secretary Kathleen Sebelius that the Commonwealth has been granted an additional year to transition into full compliance with the Affordable Care Act.
HHS has added another year to the period during which the state’s health insurers may use “rating factors” such as group size or industry to create insurance rates for the small group market. The Commonwealth now has until 2017 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.”
Under the Affordable Care Act, all but four of the rating factors used to establish health insurance premiums in Massachusetts were eliminated. The allowed rating factors under the Affordable Care Act are age, geography, family size and tobacco status. Disallowed rating factors by which health insurance carriers will be allowed to use in calculating premiums include: industry, group size, participation rate, use of intermediary and membership in a group purchasing cooperative. Under today’s guidance, the Commonwealth will have an additional year to phase out those disallowed rating factors, easing the transition for small businesses and consumers across the state.
“The extended transition is good for our market,” said 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.”
Massachusetts was initially granted a three-year transition period in September 2013 following a request by Governor Patrick.