NU Online News Service, June 4, 2003, 6:01 p.m. EDT – Colorado Gov. Bill Owens, a Republican, has signed a bill that eases restrictions on the state’s small-group health insurance market.
The bill, H.B. 1164, was introduced by Rep. Lola Spradley, Beulah, Colo., the speaker of the Colorado House.
Now that H.B. 1164 has been enacted, one section will let businesses with 50 or fewer employees buy basic policies that are exempt from state mandates requiring coverage for mental health care and hospice care, according to the bill text.
The new law also will give insurers some flexibility in setting rates for small groups and their employees.
Starting Sept. 1, 2004, for example, an insurer will be able to add up to 15% to a small employer’s renewal premiums to reflect claims experience, employee health status and other case characteristics.
Health insurers also can add up to 15% to rates for members of small plans who smoke, according to the bill text.
Other sections of the new law:
? Encourage employers to use defined-contribution health plans, by explicitly letting small employers offer coverage with $2,500 deductibles as long as they also contribute $1,000 per year to each participating employee’s “personal care account.”
? Try to increase the stability of the small-group market, by prohibiting insurance regulators from changing the rules governing the basic and standard small-group plans more than once every two years.