Small Employer Coverage Under the ACA: California vs. Federal Provisions

Kelch Policy Group


Prior to passage of the federal Affordable Care Act (ACA) in 2010, California already had extensive state law requiring carriers in the state to guarantee availability of coverage for small employer groups of 2 to 50 employees. To implement the ACA, California retained, and as necessary revised, its existing laws and regulations.

This overview compares California law and the ACA affecting the offer and sale of small employer health insurance effective January 1, 2014. The following topics are presented in a side-by-side table:

  • Application of requirements, including those regarding the size of small employers, the eligibility of employees for coverage, and definitions of employment-related associations.
  • Guaranteed issue and renewal, including guaranteed availability, exclusions and exceptions, group contribution and participation requirements, and guaranteed renewability.
  • Enrollment and coverage periods, including definitions of coverage year, enrollment periods, waiting periods, and effective dates.
  • Rates and rating factors, including risk pooling, regulatory rate review, and notice of coverage options.
  • Small Business Health Options Program (SHOP), including SHOP establishment requirements, rules and standards, employee choice of plan, and rules for market studies.

The complete table is available as a Document Download.