General Laws of Massachusetts - Chapter 149 Labor and Industries - Section 188 Fair share employer contribution

[ Text of section effective until July 1, 2013. Repealed by 2013, 38, Sec. 108. See 2013, 38, Sec. 219.]

  Section 188. (a) As used in this section, the following words, unless the context clearly requires otherwise, shall have the following meanings:--

  "Authority'', the commonwealth health insurance connector authority.

  "Contributing employer'', an employer that offers a group health plan, as defined in 26 U.S.C. 5000(b)(1), to which the employer makes a fair and reasonable premium contribution, as defined in regulation by the authority.

  "Department'', the department of unemployment assistance.

  "Employee'', an individual employed by an employer subject to this chapter for at least 1 month, provided that for the purpose of this section self-employed individuals shall not be considered employees.

  "Employer'', an employing unit as defined in section 1 of chapter 151A or in section 1 of chapter 152.

[ Subsection (b) effective until November 4, 2012. For text effective November 4, 2012, see below.]

  (b) To more equitably distribute the costs of health care provided to uninsured residents of the commonwealth, each employer that: (1) employs 11 or more full-time equivalent employees in the commonwealth and (2) is not a contributing employer shall pay a per-employee contribution at a time and in a manner prescribed by the director of unemployment assistance, in this section called the fair share employer contribution. This contribution shall be pro-rated by a fraction which shall not exceed 1, the numerator of which is the number of hours worked in the quarter by all of the employer's employees and the denominator of which is the product of the number of employees employed by an employer during that quarter multiplied by 500 hours.

[ Subsection (b) as amended by 2012, 224, Sec. 141 effective November 4, 2012. See 2012, 224, Sec. 301 repealed by 2013, 38, Sec. 149. For text effective until November 11, 2012, see above.]

  (b) To more equitably distribute the costs of health care provided to uninsured residents of the commonwealth, each employer that: (1) employs 21 or more full-time equivalent employees in the commonwealth and (2) is not a contributing employer shall pay a per-employee contribution at a time and in a manner prescribed by the director of unemployment assistance, in this section called the fair share employer contribution. This contribution shall be pro-rated by a fraction which shall not exceed 1, the numerator of which is the number of hours worked in the quarter by all of the employer's employees and the denominator of which is the product of the number of employees employed by an employer during that quarter multiplied by 500 hours.

  (c) The executive director of the authority shall, in consultation with the director of unemployment assistance, annually determine the fair share employer contribution rate based on the best available data and under the following provisions:--

  (1) The per-user share of private sector liability shall be calculated annually by dividing the sum of hospital liability and third-party payor liability for uncompensated care, as defined by law, by the total number of individuals in the most recently completed fiscal year whose care was reimbursed in whole or in part by the health safety net.

  (2) The total number of employees in the most recent fiscal year on whose behalf health care services were reimbursed in whole or in part by the health safety net, shall be calculated. In calculating this number, the authority shall use all resources available to enable it to determine the employment status of individuals for whom reimbursements were made, including quarterly wage reports maintained by the department of revenue.

  (3) The total number of employees as calculated in paragraph (2) shall be adjusted by multiplying that number by the percentage of employers in the commonwealth that are not contributing employers, as determined by the authority.

  (4) The total cost of liability associated with employees of non-contributing employers shall be determined by multiplying the number of employees, as calculated in paragraph (3) by the per-user share of private sector liability as calculated in paragraph (1).

  (5) The fair share employer contribution shall be calculated by dividing the total cost of liability as calculated in paragraph (4) by the total number of employees of employers that are not contributing employers, as determined by the authority.

  (6) The fair share employer contribution, as determined in paragraph (5) shall be adjusted annually to reflect medical inflation, using an appropriate index as determined by the authority.

  (7) The total dollar amount of health care services provided by physicians to non-elderly, uninsured residents of the commonwealth for which no reimbursement is made from the Health Safety Net Trust Fund shall be calculated using a survey of physicians or other data source that the authority determines is most accurate.

  (8) The per-employee cost of uncompensated physician care shall be calculated by dividing the dollar amount of such services, as calculated in paragraph (7) by the total number of employees of contributing employers in the commonwealth, as estimated by the authority using the most accurate data source available, as determined by the authority.

  (9) The annual fair share employer contribution shall be calculated by adding the fair share employer contribution as calculated in paragraph (6) and the per-employee cost of unreimbursed physician care, as calculated in paragraph (8).

  (10) Notwithstanding this section, the total annual fair share employer contribution shall not exceed $295 per employee which may be made in a single payment or in equal amounts semi-annually or quarterly, at the employer's discretion.

[ Paragraph (11) of subsection (c) added by 2012, 224, Sec. 142 effective November 4, 2012. See 2012, 224, Sec. 301 repealed by 2013, 38, Sec. 149.]

  (11) In calculating the fair share assessment, employees who have qualifying health insurance coverage from a spouse, parent, veteran's plan, Medicare, or a plan or plans due to disability or retirement shall not be included in the numerator or denominator for purposes of determining whether an employer is a contributing employer, as defined by 114.5 CMR 16.02. The employer shall keep and maintain proof of their employee's insurance status, in a reasonable manner as defined by the authority.

  (d) The director of unemployment assistance shall determine quarterly each employer's liability for its fair share employer contribution. The director shall assess each employer liable for a fair share employer contribution in a quarter an amount based on 25 per cent of the annual fair share employer contribution rate applicable to that quarterly period and shall implement penalties for employers who fail to make contributions as required by this section. In order to reduce the administrative costs of collection of contributions, the director shall, to the extent possible, use any existing procedures implemented by the department of unemployment assistance to make similar collections. Amounts collected pursuant to this section shall be deposited in the Commonwealth Care Trust Fund, established by section 2000 of chapter 29. Before depositing the amounts, the director may deduct all administrative costs incurred by the department of unemployment assistance as a result of this section, including an amount as determined by the United States Secretary of Labor in accordance with federal cost rules. Except where inconsistent with this section, the terms and conditions of chapter 151A which are applicable to the payment and collection of contributions shall apply to the same extent to the payment and collection of any obligation under this section. The department of unemployment assistance shall promulgate regulations necessary to implement this section.

  (e) In promulgating regulations defining the term "contribution'' under this section, no proposed regulation by the authority, except an emergency regulation, shall take effect until 60 days after the proposed regulations have been transmitted to the joint committee on health care financing and the joint committee on financial services.

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Last modified: September 11, 2015