New California Law SB 1375 – Affects Many Small Firm’s Group Health Insurance

The new California Law, SB 1375, was signed by Governor Brown on September 22, 2018 and will affect many small firm’s group health insurance. SB 1375 changes the Health Insurance Code to reclassify certain small employer groups as individuals. The affected firms will have to obtain individual health insurance in 2019, rather than the small employer group plans they currently have. Individual health insurance is typically more expensive with less provider network and benefit plan choices than small group plan offerings.

Fortunately, for CalCPA members and their firms, CalCPA Health received certain exemptions from SB 1375, which generally allows us to treat the affected firms as groups, and not as individuals. Commercial carriers (Blue Shield, UnitedHealthcare, Anthem, etc.,) must comply with the new regulations and reclassify these groups as individuals.

SB 1375 defines groups that consist entirely of owners/partners, and/or W-2 employees that are spouses of owner/partners, as not eligible for group health coverage. Even though these entities may be classified as employer/employees by other regulations, (e.g. Workers’ Comp, payroll tax, etc.,) SB 1375 specifically states they do not qualify for group health coverage and may only purchase individual plans.

Are you possibly affected by SB 1375 or know a CPA who may be?

CalCPA Health may be able to continue to provide small group coverage.

CalCPA Heath offers over 30 healthcare plans through Anthem Blue Cross, which provides the largest network of doctors and hospitals in California, for all of our CalCPA members firms (solo-practitioner, small group, large group). CalCPA Health members also have access to Delta Dental and Vision Service Plan (VSP). In addition to great premium rates and benefit plans, an array of value-adds are included at no cost to enrolled employees of CalCPA Health member firms.

Health plans by CPAs,  for CPAs since 1959   

Heading into the 60th year of service, CalCPA Health remains true to the mission of providing value added healthcare and benefit products along with quality service to CalCPA member firms. The customer service provided stands above the others in the industry, just ask our members – the people you know and trust through CalCPA.

For more information and/or to obtain a health plan proposal, contact Banyan administrators, Managers of the CalCPA Health programs, at (866) 428-4358, or fill out the form to the upper right to start your online quote today.

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