Massachusetts Governor Deval Patrick signed legislation in February that froze employer contributions to the Unemployment Insurance (UI) Trust Fund at current levels, putting off a scheduled rate hike. “Without this legislation employers would have seen an average increase of $228 per employee,” said Governor Patrick. “We want to encourage a positive climate for employers and . . . position the state for continued economic recovery.”
For a Limited Time receive a
FREE Compensation Market Analysis Report! Find out how much you should be paying to attract and retain the best applicants and employees, with
customized information for your industry, location, and job.
Get Your Report Now!Employers’ UI contributions are tied to the amount of reserves in the trust fund. By law, a scheduled increase was triggered on January 1, 2011. In order to reduce costs for Massachusetts businesses, Governor Patrick and the Legislature agreed to hold contributions at a lower rate schedule (Schedule E). This measure will not affect benefit levels or eligibility for current UI recipients.
Also in February, the Massachusetts Division of Insurance (DOI) filed regulations to allow small businesses to obtain lower-cost health care coverage through group purchasing cooperatives and increase the availability of less expensive select and tiered network plans. The regulations stem from small business health care cost containment legislation the Governor signed in August 2010.
The regulations allow for the creation of six cooperatives serving up to 85,000 people, and establish a process for organizations to file to be certified as one of the six cooperatives. Once the cooperatives are certified, insurance carriers will be required to develop products designed by the cooperatives. At this writing, DOI expects the regulations to take effect in April, and the cooperatives to be available as early as late summer.
The regulations also require carriers to offer selective or tiered network plans that cost 12 percent less than “full-network” plans. These discounted plans provide a smaller pool of providers or higher co-payments for care received from certain network providers. Other regulations filed in February will create a more robust rate-review process, change open enrollment rules, and create rate restrictions that will smooth out rate shocks on small businesses, DOI said.
For more information on DOI and health insurance costs, visit www.mass.gov/doi.
Reaction. The cooperatives are “an important step in reducing the crushing impacts of spiraling health insurance premiums on small businesses,” said Bill Luster, Executive Director of the North Shore Alliance for Economic Development.
This article appeared on HR.BLR.com.