In a recent legislative update from SIIA, it was noted that the New Jersey Department of Banking and Insurance (DOBI) approved regulations lowering minimum stop-loss attachment points for large groups of 51 lives and above, effective in late August.
This move allows the large group individual attachment points to be $20,000 per individual, reduced from $25,000 and sets the minimum aggregate attachment point at 110% of expected claims, down from 125%. These changes broaden the levels of stop-loss or excess risk coverage available to self-funded health plans and brings New Jersey’s definition in line with the NAIC Stop Loss Insurance Model Act.
The article below was published on October 24, 2017 by Self-Insurance Institute of America, Inc., written by Wrenne Bartlett.
The Self-Insurance Institute of America, Inc. (SIIA) is pleased to announce that Governor Andrew Cuomo has signed A.8264 into law, allowing grandfathered stop-loss contracts for groups of 51-100 to renew until January 1, 2019.
As background, in late 2015 and early 2016, the New York legislature passed and the governor signed three laws allowing existing stop-loss contracts of 51-100 to be renewed for a period of up to three years. Without these changes, New York State law would have prohibited stop-loss contacts to be issued to any employer classified as a “small employer,” which increased to 100 employees on January 1, 2016.
As part of the series of laws, the New York State Department of Financial Services has contracted with an independent consulting firm to study the employer use of stop-loss in the state and will be issuing a report in March 2018. In speaking to legislators and regulators, it was clear that they wanted to see the report before re-opening the 51-100 stop-loss market. To protect plan sponsors with grandfathered stop-loss policies, we suggested that the legislature extended grandfathering protection for an additional year and allow stakeholders to review the comprehensive report.
SIIA is confident that the report will conclude that smaller employers need continued access to stop-loss insurance as the most cost effective way to provide high-quality self-insured health care benefits. While the report remains ongoing, SIIA continues to press the legislature to pass a permanent fix for smaller employer stop-loss access in 2018.
If you have any questions, please contact Adam Brackemyre, vice president of state government relations at firstname.lastname@example.org or (202) 595-0641.
In New York, industry efforts to support self-funding for smaller groups have led to legislation extending the grandfathering of existing stop-loss policies for groups of 51 to 100 for an additional year, through January 1, 2019.
Other legislation impacting access to stop-loss insurance products by smaller groups has taken effect in Minnesota and is slated to become effective in New Mexico on July 1st. Attachment points are still being discussed in New Mexico and it appears that new opportunities for smaller groups may emerge in Minnesota as well. Since our last newsletter, legislation prohibiting small group stop-loss failed to advance beyond committee debate in the State of Maine.