May 31, 2019
California Senate Bill SB 1375 changes the eligibility definition for small employer health plans and employees and prohibits sole proprietorship or partnership businesses without eligible “common law” employees, which does not include a sole proprietor, a partner of a partnership, or their spouses/registered domestic partners, from purchasing employer group plans.
Beginning with April 2019 renewals, Blue Shield of California began sending recertification requests to sole proprietorships with fewer than two enrolled employees and to partnerships with fewer than three enrolled employees.
Groups may be able to maintain their small business plan(s) if they offer part-time coverage and employ at least one eligible common-law part-time employee. When responding to a recertification request, they should include consideration for offering part-time coverage and send necessary documentation (Request for contract change, reconciled DE9C and any applications/refusals for those eligible part-time employees.)
Part-time eligibility requirements must still be met in order to add employees during the recertification process (Employees must have worked 50% of the preceding calendar quarter in order to be eligible for benefits, evidenced by the DE9C or Payroll covering 50% of the preceding calendar quarter, depending on the date of hire of the part-time employee.)
Contact your LISI Regional Sales Manager for guidance on SB 1375.
