Massachusetts has made a concerted effort in the last few years to rein in health care costs for small businesses. But new federal regulations written to implement the Affordable Care Act threaten to undercut those efforts — and saddle thousands of Bay State businesses with big increases in premiums.
State law currently allows insurers to consider a range of factors that often reduce premiums for small firms. But under the new federal regulations, most of those rating factors will no longer be allowed. For example, insurers won’t be able to consider the risks inherent to the industry a company is in, or whether the company has a wellness program, or how many employees it has, or what percentage of them participate in its health plan. Those regulations will also end discounts for small businesses that have joined health-insurance-purchasing cooperatives. When the law allowing those cooperatives passed in 2010, Governor Patrick hailed it as an important step in addressing health care costs for small firms.