A bill recently introduced in the General Assembly could raise costs for entities who self-fund health insurance. Small businesses, but also counties and municipalities, could be caught by the proposed law. As described in a recent article in the Baltimore Business Journal,
Self-funding is a type of health insurance in which businesses use a pool of money to cover the cost of employees health costs, instead of buying a health plan through an insurance company. These companies buy what’s called stop-loss insurance, which kicks in should an individual employee’s health expenses drastically exceed anticipated costs. A bill (SB703) sponsored by Charles County Democrat Sen. Thomas”Mac” Middleton, would change the point at which stop-loss insurance takes over from $10,000 to $40,000.
As described in the Department of Legislative Services fiscal note,
Increased attachment points may reduce premiums for stop-loss insurance; however, purchasing policies or contracts with higher attachments points may subject small employers to greater upfront financial risk in covering claims.
SB 703 will be heard by the General Assembly on March 4.
For more information see the full story from the Baltimore Business Journal here.