Unveiling the Truth: Group Health Insurance and ACA’s Restrictions on Premiums


The Affordable Care Act (ACA) has been a game-changer in the health insurance landscape, introducing various provisions to ensure fair and affordable access to healthcare. One such provision prohibits insurers from using claims history to determine premiums for small group plans with less than 50 employees. However, a recent case has shed light on the loopholes that some employers exploit to bypass these regulations.

Exploiting Loophole for Higher Premiums

Some employers have found ways to skirt the ACA’s restrictions by opting out of the small group marketplace and forming alliances with other small groups or obtaining level-funded plans. These maneuvers effectively result in self-insured plans, which are not subject to the same regulations as fully insured small group plans. Employers who take this route can then charge premiums based on group claims, leading to significant increases for those with high medical expenses.

Implications for Employees

This practice has serious implications for employees, who may face substantial premium hikes due to the expensive prescriptions and claims of their colleagues. The post cited in this blog demonstrates the frustration and financial burden that such increases can cause.

Understanding Your Rights

It’s crucial for employees to understand that under the ACA, employers cannot base group insurance premiums on claims history if they have fewer than 50 employees. If your employer is using a loophole to charge higher premiums, you may have a legal standing to push back.

Seeking Professional Assistance

However, it’s important to seek professional guidance from a licensed insurance agent to assess your situation and explore your options. They can provide impartial advice and assist you in filing a complaint or negotiating with your employer.


The ACA’s provisions on group health insurance premiums are designed to protect employees from unfair premium hikes. However, some employers are exploiting loopholes to bypass these regulations. Employees should be aware of their rights and seek professional help if they believe their premiums are being unlawfully charged based on claims history. By understanding the nuances of the ACA and holding employers accountable, employees can ensure they have access to affordable and equitable health insurance coverage.

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