Column 73 Special Open enrollment period for small groups

Column 73 November 9

Special Open enrollment period for small groups


One challenge for small employers is often meeting insurance company minimum participation requirements.  The companies typically require 60-75% of those eligible must participate in the plan or the group is disqualified.


It is important to remember that qualified waivers can include enrollment in Medicare, Medi-Cal, other group sponsored insurance or union coverage.  So those folks do not count against you when you qualify the group.

However, if an employer is not paying most of the premium, the cost may be a barrier to employees enrolling in the plan.  The employee may not feel that they can afford the share of premium.  So they would choose not to enroll.

In the past this was a problem for an employer that wanted to provide health insurance for the employees.  A provision in the ACA requires that insurance carriers have a special enrollment period for groups that do not meet participation requirements.  The Affordable Care Act (ACA) is also known as Obamacare.

Groups may apply November 15 through December 31 for an effective date of 1/1/2015.  Some insurers are extending that period beyond those dates, but this is the minimum period.  So if you are an employer and want to look at providing insurance for your employees, now is a good time to get quotes. 

Note it is my understanding that this does not allow husband/wife only groups to obtain group coverage.  These groups are still declined by small group carriers.

Small groups will still have to meet the rest of the underwriting requirements such as providing payroll stubs or DE9 payroll tax returns.  But you will not have to be concerned if some of your employees choose not to participate.  This will not be a factor that will prohibit you from providing coverage for the rest of your employees. 

Remember that only groups with 100 or greater employees are required to offer coverage in 2015.  This number reduces to 50 starting in 2016. 

If "affordable" coverage is not provided by groups of this size, then the group is subject to a "shared responsibility payment" or penalty.  Smaller groups are not required to offer coverage and are not subject to any penalties if they do not offer coverage.

There are some small employers who manage their employees through a Professional Employer Organization (PEO).  PEO or "leased" employees are considered employees of the PEO Company. Typically, the PEO provides benefits for the employees.

Small employer groups that have canceled their PEO arrangement and hired the former PEO employees will be considered for coverage as a qualified small employer pursuant to company rules.

Looking for Social Security Numbers

Under the ACA all insurers of health plans must report on all individuals covered under these plans. To comply with these requirements, the insurer must make "reasonable attempts" to obtain any missing Social Security Numbers or Tax Identification Numbers for covered individuals, including dependents, starting this year. The first customer outreach for missing SSNs must be made by December 31, 2014.

So be prepared to have your insurer ask for this information. The insurer is required to report the following:

Name and SSN/TIN of each covered individual

• Months that each named individual was covered during the calendar year

• Name, address and EIN (Employer Identification Number) of employer sponsoring plan

            *Whether coverage is through the SHOP exchange, and the SHOP's unique identifier


Covered CA Reminder:


 Note to Covered CA enrollees who want to cancel. WAIT until after 11/10/2014.  There is a new glitch in the system!! The other reminder is to be sure to have your income verification updated on the website.  This allows Covered CA to access your tax records to verify income.  If this is not updated and you do not provide income information, you will lose your subsidy. Open enrollment starts 11/15/2014.  Let's hope the website is working!!


Note: All information in this column is provided" to the best of my knowledge" subject to final regulation by the respective agencies.