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Blue Shield of California Is Helping Employers and Brokers Understand the ACA Changes Ahead

BY BRENT HITCHINGS – As the Affordable Care Act (ACA) approaches its third year, small businesses and some large group employers will see major changes in their rates and products.

Last year, small businesses were given the option to extend their current plans for an additional year, giving them more time to understand the ACA changes ahead. These extended plans were referred to as “grandmothered,” and the majority of Blue Shield’s small business clients took this option.

Upon renewal this year, grandmothered plans will sunset and small businesses will renew into ACA plans. To help our clients and brokers better understand the changes, Blue Shield has created an infographic for small businesses highlighting the four major factors that will most impact rates as they transition to an ACA plan:

  • Standardizing product and price

  • Changing pricing regions

  • Introducing member-level rating

  • Eliminating risk adjustment factor (RAF)

Small businesses aren’t the only groups who will see changes. Another provision of the ACA is to change the definition of small business to 2-100 employees (from 2-50 previously). This means that our core account groups with 51-100 employees will now be classified as small businesses – and be subject to the same ACA changes as small businesses.

Similar to the option offered to small businesses last year, core account employers will be given the opportunity to extend their current plan through December 1, 2016 to provide more time to learn about ACA changes. For this population, Blue Shield has created an infographic for employers with 51-100 employees to illustrate their two renewal options, describe the products available and better explain how the ACA will impact rates. These clients can transition to a small business ACA plan upon renewal this year or extend their current plan through the end 2016. The following product options will be available for those who transition this year:

  • Covered California Plans purchased through the state Exchange

  • Mirrored Plans that are identical to Covered California Plans, but purchased directly from Blue Shield

  • Alternative Plans that are offered through Blue Shield outside of the exchange that comply with the ACA but provide more plan choices and network options

This year, the Small Business Health Options (SHOP) name is changing to Covered California for Small Business.

Brent Hitchings is vice president and general manager of small business at Blue Shield of California.