Frequently Asked Questions - Small Employer Health Insurance
Minnesota enacted the Minnesota Small Employer Health Benefit Act in 1992 to address concerns that underwriting and rating practices in the market created hardships and unfairness, created unnecessary administrative costs, and adversely affected the health of Minnesota residents. This new law included guaranteed renewal of small employer plans as well as guaranteed issue of health plans under certain circumstances. Effective January 1, 2014, guaranteed issue and other reforms will be in place for all small employer health plans. Changes in the small employer market are based on the federal Affordable Care Act (ACA) and market rules enacted by the Minnesota Legislature in 2013.
Q. Who qualifies as a small employer?
A. Any person, firm, corporation, partnership, association or other entity actively engaged in business (including political subdivisions of the state) is considered a small business if employs fewer than 50 full-time employees. Sole proprietors do not wualify as small employers; they can get insurance as individuals through MNsure, the new online marketplace.
Q. Are small employers required to provide health insurance to their employees?
A. No, but there are some incentives to do so via MNsure. Employees would be able to choose from among several carriers and qualified health plans rather than the employer choosing one plan for everyone. Tax credits may be available to the small employer via MNsure.
Q. Do all of the insurance companies and health maintenance organizations (HMOs) operating in Minnesota participate in the small employer market?
A. No. Coverage is marketed, offered, sold, issued, or renewed only by those health carriers that have decided to participate in the small employer health plan market. A list of participating insurance companies and HMOs which have approved policies and rates as of October 2013 is available at http://www.health.state.mn.us/divs/hpsc/mcs/smallplans.htm
A number of carriers offer small employer health coverage on the MNsure health marketplace. Go to www.mnsure.org to see the various qualified health plans (QHPs) being offered in the Small Employer Health Options Program market.
Q. Do cariers participating in the small employer market have to guarantee small employers coverage and renewal if they request it?
Q. Can dependents be covered under the small employer group health plan?
A. Yes. Dependents, including spouses and children, can be covered at the option of the employer.
Q. Can the health carrier limit coverage for individuals with pre-existing conditions?
A. No. Effective January 1, 2014 carriers are not permitted to impose preexisting condition limitations in the small employer market.
Q. Will premium rates be the same for all small employers?
A. No. Premium rates may vary based on ages of the eligible employees and dependents; geographic rating areas; use of tobacco.
Q. Will the premium rates for my company's health benefit plan increase at renewal?
A. They may.
Q. Will the gender of the employees be considered in the setting of the premium rates?
Q. What kinds of health plans are available to small employers?
A. Effective January 1, 2014 all health plans offered to small employers, both on and off MNsure must include the essential health benefits package required under the ACA and conforming state law. See Minnesota Statuates 62Q.81 for the list of essential health benefits. www.revisor.mn.gov
Q. What is the tax credit and how does the tax credit work for small employers?
A. Federal tax credits are available now for qualifying taxable and tax-exempt organizations to help reduce the cost of coverage for employees. Small employers with fewer than 25 employees who provide health insurance, and use MNsure to purchase health insurance, may qualify for a federal tax credit federal tax credit of up to 50%. The tax credit is taken on the annual tax return.
Go to "small business health care tax credit for small employers for more information, and consult your tax advisor.
For premium rate estimates for your small employer group, you should contact your insurance agent or broker. If you do not have an agent or broker, contact these health carriers. To shop online or to compare various QHPs being offered in your area, go to www.mnsure.org .
The Minnesota Department of Health certifies and regulates HMOs. Contact the Managed Care Systems section at 651-201-5100 or 1-800-657-3916 for further information about Minnesota HMOs.
The Minnesota Department of Commerce licenses other health carriers including Blue Cross and Blue Shield of Minnesota. Please contact the Minnesota Department of Commerce at (651) 539-1500 or 1-800-657-3602 for further information on these health carriers.
List of participating carriers participating in the small employer market. Plans.
For information about insurance companies or non-profit health service plans:
Minnesota Department of Commerce
85 East Seventh Place
St. Paul, MN 55101
(651) 539-1500 or 1-800-657-3602
For information about tax implications related to the provision of health care coverage for employees:
Internal Revenue Service
Room 385 Federal Building
316 North Robert Street
St. Paul, MN 55101
For more information, contact the Managed Care Systems Section:
By U.S. Mail:
Minnesota Department of Health
Managed Care Systems Section
85 East Seventh Place, P.O. Box 64882
St. Paul, Minnesota 55164-0882
By Telephone: 651-201-5100 or 1-800-657-3916
Fax: (651) 201-5186
For more information, or to file a complaint, contact the MCS at 651-201-5100 or 1 800-657-3916.