CAHU President’s Blog

Michael Lujan, President 2015-2016

Last week, President Obama signed HR1624 (The PACE Act) which permits states to either keep the federal definition of small group (under 100 employees) or define as 50 or fewer employees. But this law is not likely to impact California.

Will CA Gov Brown call for a special session?

California is one of several states, including Colorado, Connecticut, Washington, Oregon, Virginia, Vermont, Maryland, Nevada, and the District of Columbia, that passed laws redefining “small group” beginning in 2016 according to the original ACA threshold of 100 employees, to be consistent with the ACA. The PACE Act replaces the ACA originally scheduled 2016 expansion of the threshold of “small group” for health insurance from employers with “50 or fewer employees and full-time equivalents”, to employers with 100 or fewer. For states who enact the PACE Act, it means that employers in that 51-100 size bracket will not be subject to the small-group market rules.

Changing the definition again would require the California Legislature to pass new legislation. Since the Legislature is currently out of session, Governor Jerry Brown would have to call a special session to change the definition in time for the scheduled January 1, 2016 change. CAHU’s contacts in the Capitol do not believe California will adopt this change. Also, during the Covered California board meeting last week, Executive Director Peter Lee also said there does not appear to be strong political will to change back to “50 or fewer” in California. That said, it is still technically possible, so we cannot say for certain it will not impact California. Not yet. Read more here

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