Dive Brief:
- It's official: President Obama has signed legislation that will define a small business as having up to 50 workers. The ACA, left untweaked, would have expanded the definition to 100 workers on January 1, 2016.
- That move will prevent businesses of 51-100 from finding themselves forced to enter the small-group insurance market in 2016.
- The new law does leave room for states to decide if they want to increase the number of workers in their definition of a "small business."
Dive Insight:
The legal tweak to the ACA has garned attention for the unprecedented, bipartisan cooperation that made it successful.
The provision that would have expanded the definition of a small business had been unpopular on both sides of the aisle, and Obama has previously expressed willingness to adjust the ACA in ways that improve it without going against its core intent.
While the provision had originally been put in place with the aim of bringing millions of new customers into the insurance market and stabilizing the industry for small employers, the American Academy of Actuaries predicted it would likely cause "significant premium-rate changes for some groups," reported California Healthline.