March 12, 2013 – Utah has become the fourth state that is considering legislation that would make it more difficult for employers to operate self-insured group health plans by restricting the availability of stop-loss insurance.

Known as the Small Employer Stop-Loss Insurer Act, HB 160 applies to groups with 50 or fewer employees. Unlike stop-loss legislation in California, Minnesota and Rhode Island, attachment point requirements in this bill are not onerous, but does contain a provision requiring stop-loss carriers to pay claims incurred but not reported if the plan terminates. The bill would also prohibit lasering.

Other provisions include:

• Insurance Commissioner will create a standard stop loss application form for small groups
• Policy must guarantee rates for 12 months – only exception is to price for a change in benefits of the Plan
• Specific and aggregate coverage required
• Requires the stop loss to provide gapless coverage
• Minimum specific attachment point = $10,000
• Minimum aggregate corridor = 90%
• Contract basis no less favorable than 12/24

This is a developing story so please watch for further exclusive reporting from SIIA. The full text of HB 160, as well the other state stop-loss bills can be accessed on-line through the members’ only section of the association’s web site at www.siia.org. Please contact SIIA Chief Operating Officer Mike Ferguson at 800/851-7789, or via e-mail at  mferguson@siia.org should you have any questions or would be interested in helping to oppose the legislation in Utah.