Group Size Adjustments

[oscar peterson]

In small group rating (coming from someone who has only worked in one state), is group size typically determined based on eligible employees or enrolled employees? Does anyone know if that varies by state?

[Polly Nomial]

In small group rating (coming from someone who has only worked in one state), is group size typically determined based on eligible employees or enrolled employees? Does anyone know if that varies by state?

My state does not regulate the group size adjustment. That is, for SE groups it's a permitted case characteristic. It's typically done on the number of enrolled employees. There may be a few states that do not permit it as a case characteristic, but then you can use it and count it towards your decretionary rating (like health status, etc).

[oscar peterson]

That is interesting to hear, thank you. My state is implying/pushing/clarifying a group size definition based on eligible employees, not enrolleds, and I was curious what others have encountered. Thanks!

[Zee]

To the best of my recollection, when I was doing SG, you were supposed to base on eligible e'ees. But since it was easier to use enrolled count, that's what was used.

[Swiper]

Not all states allow size as a case characteristic for rating small groups. As Polly mentioned though, you can still rate for size but it must be counted as part of the +/-X% discretionery amount.

In every state that I am aware, eligible employees must be used to determine group size for purposes of determining whether the group is subject to small group reform. For example, if in a given state groups size 2-50 are subject to SGR, it implies groups with 2-50 eligibles. I beleive the NAIC model law is written this way. So if a group has 51 elgible employees but only 48 enroll, that group is not subject to small group reform.

When you talk about the application of size adjustment factors as part of rating small groups, that is a different thing. Of those states where group size is an allowed case charachteristic for SGR, I don't know of any that specify whether you need to use eligbles or those actually enrolled in setting the factors for which you rate. Group size is usually not defined in the definition section of most state small group laws. I think once it is determined that a group is subject to SGR (based on eligible employees) most companies apply the size adjustment based on enrolled employees.

Oscar, what state are you dealing with that is clarifying this rule? Are they clarifying that eligibles are to be used in the application of a size adjustment?

[11pecans]

If they are forcing you to use eligible empyees then I would use a participation load on top of the group size load such that Group size load(elig) = Group size load (enrolled) + Particiapation load

[Polly Nomial]

Swiper's got it. (I was too lazy to write that all out.)

I find it hard to believe that the state is requiring, or even suggesting, that you use number of eligibles as any sort of size marker other than whether the the regs apply or not. But then again.......