More Renewal Options for Small Employers in CA
Governor Brown announced Monday, July 7th that he signed SB 1446, the “Grandmothering” bill. SB 1446 moved rapidly and unopposed through both Houses in the California legislature. Now that the bill has been signed into law, it will go into effect immediately as an “urgency statute.”
SB 1446 will allow a small business employer health care plan that was in effect on December 31, 2013 and that is still in effect as of the date the bill was signed (July 7, 2014) and that does not qualify as a grandfathered health plan under the ACA, to be renewed until January 1, 2015, and to continue to be in force until December 31, 2015. The bill also states that these plans must be amended to be in compliance with the ACA guidelines as of January 1, 2016, “in order to remain in force on and after that date.”
This will help some small California employers who opted to early renew their plans in 2013. The small employer group policies affected by SB 1446 must still include many ACA and state-based mandated benefits such as preventative healthcare coverage without copays or deductibles, no lifetime caps on benefits, maternity care, coverage for autism and the elimination of gender discrimination in setting premiums.
Keep in mind that this bill is not a mandate and employers are not required to keep these plans in place. This bill is meant to be a “transitional measure” to allow small employers more time to comply with the rules set down by the ACA.
The bill does not address rates, so premiums for these plans may increase.
If you renew in the last quarter this year, it is best to have your broker compare the 2013 renewal with options to convert to 2014 ACA compliant plans so you can look at the differences in cost and coverage and make the best decision for your business.