Business health policy costs to go up

Health insurance premiums for 5,700 small businesses in California — which employ roughly 47,000 workers — will go up 4.6 percent in 2019, Covered California announced Thursday.

The increase applies to the small slice of California companies and workers that get their health insurance from Covered California for Small Business, the exchange created under the Affordable Care Act where companies with 100 or fewer workers can buy health plans for their employees.

Most of the state’s small businesses buy health insurance directly from insurance companies or from other exchanges including Cal Choice. But the creation of California’s small-business exchange gave

employers more choices of health plans to pick from and improved competition in the small group market, said Mark Herbert, California director of Small Business Majority, an advocacy group that backed the ACA.

The Covered California exchange also allows employers to get a tax credit for providing insurance if enough of their workforce are lowwage earners.

The 4.6 percent increase is less dramatic than in previous years, when premiums rose between 5 and 8 percent each year. In 2018, premiums jumped 5.6 percent. About 2 million Californians get their health insurance from a small business, researchers estimate.

By comparison, the roughly 2.3 million Californians who buy individual insurance through Covered California will see an 8.7 percent increase in premiums.

The Affordable Care Act, which took effect in 2014, requires companies with at least 100 full-time equivalent employees to provide health insurance that meets certain standards or pay a tax penalty. The penalty depends on several factors, including how comprehensive any employer-provided policy is and how many workers are covered.

The mandate was later expanded to apply to companies with at least 50 employees.