Mass. given extra year to phase in part of Obamacare
The Obama administration has granted Massachusetts an additional one-year waiver from a key part of the Affordable Care Act (ACA) that requires Massachusetts to reduce from nine to four the factors used to calculate health premiums for individuals and small businesses.
The transitional waiver, originally granted in 2013 and extended in 2014, gives health insurers until January 2018 to come into full compliance with the ACA, which requires that premiums be calculated based only on age, family size, geographic area, and tobacco use.
The letter from the federal Centers for Medicare and Medicaid Services (CMS) to Massachusetts Health Connector Executive Director Louis Gutierrez stipulates that small group insurers may continue to use two-thirds of the state's full ensemble of rating factors, including industry, group size and participation rate, until January 2017 when they must reduce the use of the state specific factors to one-third.
Gov. Charlie Baker in late April requested an "indefinite extension" of the transition period, warning of "disruption" and "instability" in the marketplace that would result from fully phasing out the premium factors. CMS officials on May 26 agreed to just a one-year extension, and the administrations have spent the past three week negotiating the details of the transition.
"Protecting small businesses from massive insurance rate hikes is essential to making sure job creators continue to thrive here and I am grateful the Obama administration granted Massachusetts this flexibility," Baker said in a statement.
The governor has also asked that Massachusetts be allowed to continue to limit the size of businesses that qualify for small group insurance to 50 employees rather than expand the definition to up to 100 employees, as required under the ACA starting Jan. 1, 2016.
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