Michigan will keep the Large Group Definition as 50+ for employer healthcare rating purposes

Effective immediately Michigan Employers in the 51-100 employee healthcare marketplace will remain defined as a large group. As I mentioned in my post on October 8th when the President signed the PACE Act on the 9th, I hoped that Michigan would follow suit.  They have.

What this means is that the 50+ market size will not move to the small group rating system implemented by ACA. A move that could have greatly increased healthcare costs for many of those employer groups, as well as, adding greater administrative burden.

This is GREAT NEWS for Michigan Businesses.

Michigan has rescinded Transitional Order 15-012M to line up with the PACE Act. The Act redefined the large group definition to 100+employees, moving the 51-100 employee groups to the small group definitions (this is for rating purposes).  Many of those employers qualified for the additional transition relief, giving them an extra year in which to comply, which would be 2016. The state MI state has held the definition of  large group as 50+ for some time. So the Transition Order is no longer necessary.

The Rescinding order states:

“STATE OF MICHIGAN DEPARTMENT OF INSURANCE AND FINANCIAL SERVICES Before the Director of Insurance and  Financial Services In the matter of: Order No. 15-044-M Affordable Care Act Large Group Market Transitional Policy/ Issued and entered this 9th day of October 2015 by Patrick M. McPharlin Director ORDER RESCINDING ORDER NO. 15-012-M REGARDING AFFORDABLE CARE ACT LARGE GROUP MARKET TRANSITIONAL POLICY

Under Michigan law, employers with between 51 and 100 employees are considered to be “large group” employers. However,the Affordable Care Act (ACA) required these employers to purchase coverage in the small group market as of January 1, 2016. On March 26, 2015, the Director entered Order No. 15-012-M, which established a transitional period by allowing these employer groups to purchase new large group coverage and to renew their existing coverage, under certain conditions. On October 7, 2015, President Obama signed the Protecting Affordable Coverage for Employees Act (PACE  Act). The PACE Act amends the ACA so that employers with 51 to 100 employees may still be considered “large group”  employers and remain eligible to purchase and renew coverage in the large group market as they have done historically under Michigan law. As a result, there is no longer any need to provide a transitional period for employer groups with between 51and100 employees, and no need to impose the conditions enumerated in Order No. 15-012-M on the purchase or renewal of large group coverage for these employer groups. Accordingly, Order No. 15-012-M is no longer necessary.

THEREFORE, IT IS ORDERED that Order No.15-012-M is rescinded, effective immediately.”
See Official Order:

http://www.michigan.gov/documents/difs/Transitional_Order_15-044-M_502638_7.pdf

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