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No. But if you permit one employee within a class to cover dependents, then you must permit
all employees within that class to cover dependents. Distinctions in classes of employees
must be based on bona fide conditions pertaining to employment, such as job title, length of
service, salary, etc.
19. If I permit my employees to cover dependents, do I have to contribute to the premium for
dependents?
No. While you are required to contribute 10% of the total premium for your covered
employees, you do not necessarily have to contribute to the premium related to dependent
coverage. Because the dependent premium is part of the total premium, if you contribute
nothing towards dependent coverage, you’ll need to contribute more than 10% of the
employee cost in order to satisfy the requirement to contribute at least 10% of the total
premium. Of course, if you elect to contribute to the dependent premium, you may choose
to contribute any amount you wish, by class of employee.
20. If I contribute to a health savings account for my employees, does that amount count
towards the required contribution for the health benefits plan?
No.
21. May I change my contribution levels?
Yes. However, you may not contribute less than 10% of the group premium. Further, the
change can only be made if the current plan has been in force at least 12 months. Pursuant
to federal law, if you elect to change your contribution levels, the change creates a special
enrollment period for your employees. This allows employees who may have previously
declined coverage to enroll, and allows enrolled employees to terminate their enrollment or
to change to an alternate coverage option if your group has more than one option available.
22. Does my group have to continue to meet eligibility requirements?
Yes, on an annual basis. Once a year – several months prior to the anniversary date of your
policy – you will have to complete an employer certification regarding your group’s census,
and verify that contribution and participation requirements continue to be met.
23. What happens to my group’s coverage if the number of my employees eventually exceeds
50?
If your business grows to more than 50 employees, you may become ineligible to purchase
or amend small employer coverage, but not right away, because eligibility is based on average
employment activity in the prior calendar year. So, even if you have 55 employees today, the
carrier will look at the number of employees you had during the prior calendar year.
Once the number of employees during the prior calendar year exceeds 50, an employer is no
longer a small employer. If such an employer wishes to remain covered under the plan(s)
purchased while the employer was a small employer, the employer may renew the previously
purchased small employer plan(s) without any changes. However, the rates charged may no
longer be the carrier’s SEH market rates. The carrier will refuse any application to make a
change to the plan(s) in any way, no matter how minor, because the employer completing