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Changes to how carriers calculate small group business premiums

The Affordable Care Act (ACA) mandates new rules about how insurance carriers calculate premiums for small group business (1-50 eligible employees). As of September 5, all insurance carriers have been informed of how this must be done beginning January 1, 2015. Although the new methodology is premium neutral, there are a few differences from our current methodology.

Here are the differences:
  • All small group medical plans will move to a four-tier rate structure beginning January 1, 2015-this means that we convert all small group business to four-tier rates on renewal and only allow four-tier rates for new business.
  • The Massachusetts Division Of Insurance and US Department of Health & Human Services mandate how the rate relativities between tiers will change.
  • Two-tier and three-tier rates will no longer be allowed for medical groups.
  • Dental and senior plans and their ratings for small group offerings will not change, as the ACA does not apply to these types of plans.
  • BlueQuoteSM will be updated to accommodate these changes beginning with January 1, 2015 effective dates.
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