NU Online News Service, Nov. 13, 1:50 p.m. – The New Jersey Assembly is considering a bill that would make it easier for small employers to meet health insurers’ requirements for employee health plan participation.

Assembly Bill 3938 would allow employers to count employees who are covered under their spouses’ group health plans, or Medicare, in determining the participation rates required by health insurers.

Health insurers set minimum participation rates to protect against adverse selection. Insurers fear that plans with low participation rates, or no employer premium contributions, will attract only the sickest employees.

A.B. 3938 would allow insurers to require that at least 75% of an employer’s workforce participate in a plan and that the employer contribute at least 10% of the plan’s cost.

When an insurer calculates an employer’s participation rate, it would have to include employees covered by other health benefits programs, such as Medicare, and it would have to count all employees covered by the employer’s own plans the same way, whether the employees were covered by indemnity plans or health maintenance organizations.

The lead sponsor is Assemblyman Richard A. Merkt, R-Randolph, N.J..