Executive Summary: On October 7, 2015, the Protecting Affordable Coverage for Employees Act (“PACE Act”) was enacted, and on October 19, 2015, the Department of Health and Human Services released FAQs providing further guidance on the Act’s application to states. The PACE Act gives states the option of continuing to define “small group” for purposes of the ACA market reforms as those with up to 50 employees instead of mandating the expansion of that definition to those with up to 100 employees as originally required by the ACA. This means that in states that choose to continue to define small group as up to 50 employees, mid-sized employers will be able to avoid the potential increase in premiums that could result from being included in the small group market. Importantly, the PACE Act does not affect definitions of large and small employer for purposes of the employer mandate.
Home > Federal Law Articles > Employee Benefits > Health Care Reform > The PACE Act β Changes to the Definition of Small Group for Purposes of ACA Market Reforms