In 2014, we are going to see a major transformation of the small group health insurance market.
One of the biggest changes is the community ratings. No longer will a small group premium be based on medical conditions. This means most will groups will have similar pricing. Right now small groups in the area are medical underwritten. Healthy groups have lower cost than high utilization groups. The high utilization groups could have a decrease in premium. The healthy groups could have an increase in premium. This will create a unique situation for small business that has not been seen.
At this time, we do not know what the community rating will look like. Some of the carriers do! The national carriers that have been operating in states that have community ratings have large amounts of data on this subject. This could create a problem for the smaller companies that do not have experience in these markets. This could lead to less competition in the small group market.
If a small business decided to keep a group plan they will want to be with a company that has the experience of community rating.
United Healthcare is really the main carrier in the Indianapolis market, that has that kind of experience for small group.