Although President Obama signed the Protecting Affordable Coverage for Employees (PACE) Act this week, many employers the legislation is intended to protect remain in limbo. The PACE Act nullifies the Affordable Care Act’s originally scheduled 2016 expansion of the threshold of “small group” for health insurance purposes from employers with 50 or fewer employees and full-time equivalents, to those with 100 or less.
The PACE Act’s enactment means that employers in that 51-100 size bracket that buy health coverage will not be subject to the small-group market rules. Under the ACA, small-group plans are subject to the requirement to provide the 10 essential health benefits and have fewer underwriting criteria to use, making coverage significantly less costly for some groups (particularly those with healthy workforces), and more so for others.
