CBP is a privately owned midsize consulting firm with 45 employees in its employee benefits arm. Its mission includes group benefits, risk management, executive benefits and HR needs, tailoring programs to individual clients. Its main office is 1100 Summer St. in Stamford, with satellite facilities in Connecticut in Fairfield, Plantsville and Westbrook and in Manhattan and in Maywood, N.J.
Company founder and principal Gary Piantedosi recently assessed the adjustments coming to health insurance for the FCBJ. “It”™s been an extremely challenging year for most of our clients with the new compliance requirements for the ACA along with the ever-changing landscape of health care reform.”
FCBJ: The state insurance commissioner has notified employers she will delay the Jan. 1 expansion of the small-group insurance market. Is this correct and what does it mean for employers?
Piantedosi: “That is correct, on Oct. 9, the state of Connecticut did postpone the expansion of the small-group definition, but some carriers are still struggling with the underwriting of the groups between 50 to 100 employees as their requirements had mirrored the law before the (Protecting Affordable Care for Employees) Act.
“This change is huge. Two different underwriting scenarios are in play in some businesses: those respecting the 50-person number and those that have already embraced the 100-person number. “Three months ago we started looking at all our 50 to 100 employee clients. We followed the dual track method. We needed to be prepared. Obviously we”™re very happy the PACE Act passed because it affords our clients a simplicity and a flexibility they have been used to by not being in a community-rated pool.”
This shift is due to the fact the Protecting Affordable Coverage for Employers Act was signed into law by President Obama Oct. 8. Connecticut is postponing. What of the national picture?
Piantedosi: “At this point, there are multiple states that have or are inclined to keep the small-group definition as outlined by the ACA ”” up to 100. Those states are California, Colorado, New York, Virginia and Vermont, along with the District of Columbia. Other states have been on the fence, including North Carolina, Nevada and Oregon. They will have until Oct. 30 to make that determination and notify the Centers for Medicare and Medicaid Services.”
Before this act passed, the prevailing thought was mid-sized employers would receive large rate increases due to being pushed into the small-group market, but with the passing of the PACE Act, there could now be more flexibility, which could help avoid coverage disruption and premium hikes. Is this true?
Piantedosi: “Unfortunately, for those states who will press forward with the expanded definition of Small Group ”” the 100 number ”” this will not be the case. The small-group definition expansion was intended to grow the small-group pool to help the claim experience, along with helping the not-for-profit co-ops that were set up in different states under the ACA.
“Out of 23 co-ops that existed last year, just in October alone five announced plans to shut down, which makes the total nine ”” the soon-to-shutter New York”™s Health Republic, the largest co-op with 155,000 customers being one of them ”” with another 12 nationally under financial stress. Between the lack of continuous funding from the federal government and higher-than-expected claim experience, the future of these remaining co-ops is in question.”
