Blue Cross of MA to Bump Back up Employer Premium Payment Threshold

July 13, 2007 ( - Blue Cross and Blue Shield of Massachusetts has agreed to end a new policy that would have required small business owners to contribute only a third of employee health plan premiums.

The Boston Globe reports that the insurer said it made the change at the request of Governor Deval L. Patrick. Patrick told Blue Cross the low premium contributions would hurt the state’s universal health care efforts.

Prior to the new policy, which started July 1, employers with 50 or fewer workers were required to pay a minimum of 50% of employee premiums, according to the Globe. Patrick’s administration said that if Blue Cross allowed lower employer contributions, other companies might follow suit, leading to employers contributing as little as possible to their employees’ health care and company-sponsored health insurance plans that are too expensive for some workers.

Under Massachusetts’ health care reform law, some low-income workers can only receive subsidized coverage under the state’s Commonwealth Care program if their employer offers no company health plan. The administration of former Governor Mitt Romney last year said a company would be considered to have made a “fair and reasonable” contribution to health care coverage and would not be subject to the $295 per employee penalty under the new law if it paid one-third of a single employee’s premium costs (See New Bay State Rules Would Excuse Most Cos. from Per-Worker Health Coverage Fee).

The average contribution by Massachusetts employers currently is about 75%, the Globe said.