President Obama signed into law a change in the way small employers can be defined under Obamacare starting next year.
The legislation, dubbed the Protecting Affordable Coverage for Employees Act, represents a relatively rare instance in which Democrats and Republicans have agreed to tweak the 2010 healthcare law. Starting in January, the law was going to move employers with 51 to 100 workers from the large group insurance market to the small group market, which would expose them to new, costly coverage requirements.
The new law keeps things the way they are now, allowing those employers to remain in the large group market, but says states can go ahead with the reclassification if they wish. The president signed the legislation late Wednesday with little fanfare, after both the House and Senate passed the legislation overwhelmingly last week.
Lawmakers from both sides of the aisle applauded Obama for approving the bill.
“This bill will make a helpful adjustment to the Affordable Care Act for small and midsize businesses by limiting potential premium increases and letting states determine what’s best for their market,” said Sen. Jeanne Shaheen, D-N.H., who co-sponsored the Senate version with Sen. Tim Scott, R-S.C.
“I am pleased we were able to stop the growth of Obamacare and block implementation of this harmful rule,” Scott said. “I remain committed to a full repeal of the healthcare law, and will keep working to find solutions that put doctors and patients in charge, not the federal government.”
Owners of small business with more than 50 employees were deeply worried they might face large premium increases if they were forced to switch over to the small group market. Oliver Wyman had estimated that these employers would see average premium increases of 18 percent next year if they were subject to the new requirements.
Major trade associations and insurers had lobbyed heavily for the bill, including the National Association of Insurance Commissioners, the United States Chamber of Commerce, the National Federation of Independent Business, America’s Health Insurance Plans and the Blue Cross and Blue Shield Association.
