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California Healthline Daily Edition

Summaries of health policy coverage from major news organizations

Brown Signs Bill Delaying ACA Deadline for Small Businesses

On Monday, Gov. Jerry Brown (D) signed into law a bill (SB 1446) that will give state businesses with fewer than 50 employees an extra year to obtain health coverage that complies with Affordable Care Act requirements, the Sacramento Business Journal reports.

The measure takes effect immediately and allows small businesses to renew coverage at any point in the year (Robertson, Sacramento Business Journal, 7/7).

Background

Under the ACA, all health plans must include 10 essential benefits, including hospitalization, prescription drugs, maternity care and mental health treatments (O'Neill, "KPCC News," KPCC, 7/7).

The law's employer mandate provision states that any health plans that do not meet all 10 requirements will be canceled at the end of 2014.

Details of New Law

SB 1446 was introduced by Sen. Mark DeSaulnier (D-Concord). State Insurance Commissioner Dave Jones (D) and the California Department of Insurance also sponsored the measure.

The new law gives businesses with fewer than 50 employees until the end of 2015 to comply with the ACA's rules. If at the end of 2015 the eligible businesses' sponsored health plans still do not meet the law's requirements, such plans will be canceled (California Healthline, 5/21).

Reaction

In a news release, Jones called the new law "a victory for all California small businesses." He added, "While many small employers will move to new health insurance options right away, SB 1446 provides additional choices to those who choose to use the transition period" (DOI release, 7/7).

John Kabateck, executive director of the California chapter of the National Federation of Independent Business, said that the extension "will give some short-term relief to scores of small business owners who still have concerns about this law" (Sacramento Business Journal, 7/7).

However, Kabateck said that NFIB still has concerns about the amount of time businesses have to obtain new coverage, adding, "A year can disappear very quickly." He said NFIB would have preferred an earlier version of the measure that would have given small business a three-year reprieve from complying with the ACA ("KPCC News," KPCC, 7/7).

This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.
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