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Stop-loss shift hits some states harder

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Regulators want to know if small businesses are running to self-funding to escape the Patient Protection and Affordable Care Act.

The ERISA Working Group, an arm of the National Association of Insurance Commissioners, asked members to report any big fluctuations in the stop-loss sector in their jurisdictions. Twenty-three states replied.

Ten said theyve seen increases in stop-loss filings, and 12 said they believe they have seen an increase in interest in use of self-funding in the small-employer market.

But “13 states indicated no significant change in the number or kinds of stop-loss filings,” the working group reported in a summary of the survey results.

Regulators in 11 states said theyve not seen much change in small employers interest in self-funding or did not know whether any change had occurred.

Michigan and Nevada regulators both reported an increase in filings and changes in the types of stop-loss filings.

Self-insured plans are exempt from several provisions of the Patient Protection and Affordable Care Act. Some health policy watchers have suggested the small employers with the lowest claims might rush to cut their premiums and increase their flexibility by switching to self-insured plans. Others have suggested a small-employer rush to stop-loss could leave traditional insurers with the sickest, oldest employers and eventually lead to a death spiral in the small-group market. 

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