Issue 94: PACE Act Signed Into Law

This is the ninety-fourth issue in our series of alerts for employers on selected topics in health care reform. (Click here to access our general summary of health care reform and other issues in this series). This series of Health Care Reform Management Alerts is designed to provide an in-depth analysis of certain aspects of health care reform and how it will impact your employer-sponsored plans.

On October 8, President Obama signed a bipartisan bill into law -- the Protecting Affordable Coverage for Employees Act or PACE Act. The PACE Act amends the definition of "small employer" for purposes of the non-tax portions of the Affordable Care ACT (ACA). Under the law, states have the option to continue defining "small employer" as an employer with fewer than 50 employees in 2016. Absent the PACE Act, the definition of "small employer" would automatically increase for plan years beginning on or after January 1, 2016 to include an employer with 100 or fewer employees.