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HCR Update: Group Size Definitions, MLR, etc.

Dec 03, 2010

Health Care Reform Update

December 3, 2010


New Group Size Definitions and Differences Fact Sheet

The health care reform law established federal definitions of "small employer" and "large employer" for health insurance markets. Previously, states defined these markets. However, the definitions aren't applied consistently throughout the law. In addition, some provisions that set different thresholds consider only full-time employees in the calculation rather than full-time equivalencies.

To clarify these differences, we've developed a new fact sheet that explains the group size definitions in the health care reform law and provides examples of provisions that vary by group size and/or calculation method.  

Employer Guide Mailing Targets Clients for Whom We Don't Have E-mail Addresses

When it comes to the health care reform law, there's a lot to know. So, we created a brochure with as many health care reform details as we could pack into it and shared it with you several months ago. We also e-mailed it to employers. Now we're mailing it to our employer clients for whom we don't have e-mail addresses.

If you'd like printed copies of this brochure, please contact your account representative. To see an electronic version, check the library section of

New Fact Sheets on Medical Loss Ratios       

On November 22, the U.S. Department of Health and Human Services issued interim final regulations for the medical loss ratio provision of the health care reform law. The interim final rules clarify how the medical loss ratio will be calculated and reported, and provide details on the rebate process. In addition, the interim final rules confirm that the medical loss ratio provision does not apply to self-insured or ASO plans. It applies only to the issuer of insurance plans in the large and small group and individual markets.

For more details and talking points, refer to this fact sheet. 

Employer enforcement of exclusion for dependents who are eligible for their own employer-sponsored coverage

The health care reform law allows grandfathered group health plans to exclude coverage for young adult dependents who are eligible for their own employer-sponsored coverage. While we aren't making this exclusion standard, 100+ grandfathered groups can choose to have the exclusion.

If a group chooses to exclude coverage for dependents who are eligible for their own employer-sponsored coverage, we will add the exclusion to the group's certificate language. However, we will not enforce the exclusion on behalf of the group. The employer will need to develop a method that suits its particular needs, as well as materials that support the enforcement method (such as an affidavit for employees to verify that their covered dependents are not eligible for their own coverage).

Getting to the bottom of your health care costs       

Did you know: Nearly $50 billion will be spent to comply with software and billing code mandates?

According to the Wall Street Journal (Nov. 1, 2010), Forrester Research expects the U.S. health-information market to spend nearly $50 billion over the next two years as health care providers are faced with federal mandates to upgrade software and switch to a new system of insurance billing codes.

This content is provided solely for informational purposes: it is not intended as and does not constitute legal advice. The information contained herein should not be relied upon or used as a substitute for consultation with legal, accounting, tax and/or other professional advisers.

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