Big Change in Group Health Insurance
Federal health insurance reforms may cause a major disruption in the group insurance market, according to the Texas Association of Health Underwriters, a professional association of insurance agents and brokers who focus on health insurance and employee benefits.
For many years, “small employer” group health plans were defined as groups of 1-50 or 2-50 employees. On Jan. 1, 2016, however, that size limit changes to 1-100 under the Affordable Care Act (ACA).
“This is going to be more than a ‘train wreck,’ ” said TAHU President Joe Phifer of Dallas.
Toby Meason, Benefits Agent with DFB Insurance Group in Amarillo agrees and said there were compelling reasons this big change should be delayed:
- Insurance companies may stop selling small group plans altogether. Many carriers have never participated in this segment of the group health insurance market that serves smaller employer groups. They simply don’t have the experience and expertise.
- There will be less choice and competition. As some carriers pull out, this means employers have fewer plans and companies from which to choose.
- More rigid rating and benefit requirements for small group plans may cause medium sized employers’ rates to be hit even harder this year, with average rate increases of about 18%.
TAHU is working with the National Association of Health Underwriters (NAHU) and many other business group stakeholders to support ways to cope with the impending changes. One of these initiatives is to support legislation introduced in the U.S. Congress, S. 1099 and H.R. 1624, giving each state the right to draw its own parameters on group size. Alternatively, there is also a big push to get the Administration to postpone compliance requirements for two years, which would leave current group size requirements in place.
How would the proposed delay affect group health insurance in Texas?
House Insurance Chairman John Frullo, Lubbock, said, “I completely support the work the Texas Association of Health Underwriters (TAHU) is doing to minimize disruptions to the insurance market and support public policy that makes sense for Texas. Small and midsized employers are the backbone of our thriving Texas economy and we need to help these businesses provide affordable health insurance, not overburden them with senseless regulations and higher costs.”
The Texas Association of Health Underwriters (TAHU) is a statewide membership association representing licensed health insurance agents, brokers, consultants and benefit professionals who serve the health insurance needs of employers and individual consumers seeking health insurance. TAHU is a state affiliate of the National Association of Health Underwriters.
Lee ManrossTexas Association of Health UnderwritersGovernment Affairs512-322-9787LManross@aol.com
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