LAWRENCE J. HOGAN, JR., Governor Ch. 483
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Chapter 483
(Senate Bill 632)
AN ACT concerning
Maryland Health Benefit Exchange – Small Business and Nonprofit Health
Insurance Subsidies Program – Workgroup
FOR the purpose of establishing a Small Business and Nonprofit Health Insurance
Subsidies Program in the State to provide subsidies to small business and nonprofit
employers and their employees for the purchase of qualified health benefit plans on
the Maryland Health Benefit Exchange requiring the Maryland Health Benefit
Exchange to convene a workgroup to study and make recommendations relating to
the establishment of a Small Business and Nonprofit Health Insurance Subsidies
Program to provide subsidies to small businesses and nonprofit employers and their
employees for the purchase of health benefit plans; and generally relating to the
Maryland Health Benefit Exchange and subsidies for small businesses and
nonprofits.
BY repealing and reenacting, with amendments,
Article – Insurance
Section 31–107
Annotated Code of Maryland
(2017 Replacement Volume and 2021 Supplement)
BY adding to
Article – Insurance
Section 31–123
Annotated Code of Maryland
(2017 Replacement Volume and 2021 Supplement)
SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF MARYLAND,
That the Laws of Maryland read as follows:
(a) The Maryland Health Benefit Exchange shall convene a workgroup to study
and make recommendations relating to the establishment of a Small Busines s and
Nonprofit Health Insurance Subsidies Program to provide subsidies to small businesses
and nonprofit employers and their employees for the purchase of health benefit plans.
(b) The Exchange shall invite the following persons to participate in the
workgroup convened under subsection (a) of this section:
(1) individuals from the small business and nonprofit community,
including owners, employers, and employees;
(2) health insurance carrier representatives; Ch. 483 2022 LAWS OF MARYLAND
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(3) licensed health insurance producers;
(4) representatives of business, nonprofit, consumer advocacy, and other
organizations; and
(5) any other person who expresses interest in participating in the
workgroup.
(c) The workgroup convened under subsection (a) of this section shall study and
make findings and recommendations regarding:
(1) the health insurance coverage needs of small employers, nonprofit
employers, and their employees;
(2) objectives and target metrics for the Program;
(3) the optimal scope and design features of a Small Business and
Nonprofit Health Insurance Subsidies Program, including:
(i) whether subsidies under the Program should be available for the
purchase of qualified health plans offered to small employers on the Exchange and the
purchase of health benefit plans offered to small employers outside the Exchange;
(ii) subsidy eligibility and payment parameters for the Program;
(iii) the administrative structure and infrastructure investments
required for implementation of the Program, including any requirements for the Exchange,
health insurance carriers, and any other entities involved in the implementation of the
Program; and
(iv) the duration of the Program;
(4) the cost to administer the Program, including the cost to provide
subsidies and operational costs; and
(5) the sources and levels of funding needed to support the Program.
(d) On or before October 1, 2022, the Exchange shall submit a report to the
Governor and, in accordance with § 2–1257 of the State Government Article, the Senate
Finance Committee and the House Health and Government Operations Committee that
includes the findings and recommendations of the workgroup required under this section.
SECTION 2. AND BE IT FURTHER ENACTED, That it is the intent of the General
Assembly that, beginning in fiscal year 2024 and in each fiscal year thereafter, the
Governor shall include in the annual budget bill an appropriation of funding to establish LAWRENCE J. HOGAN, JR., Governor Ch. 483
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and operate a Small Business and Nonprofit Health Insurance Subsidies Program with a
design as recommended by the workgroup under Section 1 of this Act.
Article – Insurance
31–107.
(a) There is a Maryland Health Benefit Exchange Fund.
(b) (1) The purpose of the Fund is to:
(i) provide funding for the operation and administration of the
Exchange in carrying out the purposes of the Exchange under this subtitle;
(ii) provide funding for the establishment and operation of the State
Reinsurance Program authorized under this subtitle;
(iii) provide funding for the Medical Assistance Program and the
Senior Prescription Drug Assistance Program;
(iv) provide funding for the establishment and operation of Health
Equity Resource Communities under Title 20, Subtitle 14 of the Health – General Article;
[and]
(v) provide funding for the establishment and operation of the
State–Based Young Adult Health Insurance Subsidies Pilot Program authorized under this
subtitle; AND
(VI) PROVIDE FUNDING FOR THE ESTABLISHMENT AN D
OPERATION OF THE SMALL BUSINESS AND NONPROFIT HEALTH INSURANCE
SUBSIDIES PROGRAM AUTHORIZED UN DER THIS SUBTITLE .
(2) The operation and administration of the Exchange, the State
Reinsurance Program, [and] the State–Based Young Adult Health Insurance Subsidies
Pilot Program, AND THE SMALL BUSINESS AND NONPROFIT HEALTH INSURANCE
SUBSIDIES PROGRAM may include functions delegated by the Exchange to a third party
under law or by contract.
(c) The Exchange shall administer the Fund.
(d) (1) The Fund is a special, nonlapsing fund that is not subject to § 7–302 of
the State Finance and Procurement Article.
(2) The State Treasurer shall hold the Fund separately, and the
Comptroller shall account for the Fund.
Ch. 483 2022 LAWS OF MARYLAND
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(e) The Fund consists of:
(1) any user fees or other assessments collected by the Exchange;
(2) all revenue deposited into the Fund that is received from the
distribution of the premium tax under § 6–103.2 of this article;
(3) income from investments made on behalf of the Fund;
(4) interest on deposits or investments of money in the Fund;
(5) money collected by the Board as a result of legal or other actions taken
by the Board on behalf of the Exchange or the Fund;
(6) money donated to the Fund;
(7) money awarded to the Fund through grants;
(8) any pass–through funds received from the federal government under a
waiver approved under § 1332 of the Affordable Care Act;
(9) any funds designated by the federal government to provide reinsurance
to carriers that offer individual health benefit plans in the State;
(10) any funds designated by the State to provide reinsurance to carriers
that offer individual health benefit plans in the State;
(11) any funds designated by the State to provide State–based health
insurance subsidies to young adults in the State;
(12) ANY FEDERAL FUNDS AV AILABLE TO PROVIDE H EALTH
INSURANCE SUBSIDIES TO QUALIFIED SMALL B USINESS AND NONPROFI T
EMPLOYERS AND THEIR EMPLOYEES IN THE STATE, INCLUDING FUNDS FROM THE
FEDERAL AMERICAN RESCUE PLAN OF 2021;
[(12)] (13) any federal funds received in accordance with § 31–121 of this
subtitle for the administration of small business tax credits; and
[(13)] (14) any other money from any other source accepted for the benefit
of the Fund.
(f) (1) The Fund may be used only:
(i) 1. for the operation and administration of the Exchange in
carrying out the purposes authorized under this subtitle;
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2. for the establishment and operation of the State
Reinsurance Program; and
3. for appropriations to the Health Equity Resource
Community Reserve Fund under § 20–1407 of the Health – General Article;
(ii) in fiscal years 2021 and 2022, for the Medical Assistance
Program within the Medical Care Programs Administration of the Maryland Department
of Health;
(iii) in fiscal year 2022, for the Senior Prescription Drug Assistance
Program established under Title 15, Subtitle 10 of the Health – General Article; [and]
(iv) for the establishment and operation of the State–Based Young
Adult Health Insurance Subsidies Pilot Program; AND
(V) FOR THE ESTABLISHMEN T AND OPERATION OF T HE SMALL
BUSINESS AND NONPROFIT HEALTH INSURANCE SUBSIDIES PROGRAM.
(2) In each of fiscal years 2023 through 2025, the Governor shall:
(i) transfer $15,000,000 to the Health Equity Resource Community
Reserve Fund; and
(ii) include the funds transferred in accordance with item (i) of this
paragraph in the annual budget bill as an appropriation to the Health Equity Resource
Community Reserve Fund under § 20–1407 of the Health – General Article.
(g) (1) The Board shall maintain separate accounts within the Fund for
Exchange operations, for the State Reinsurance Program, [and] for the State–Based Young
Adult Health Insurance Subsidies Pilot Program, AND FOR THE SMALL BUSINESS AND
NONPROFIT HEALTH INSURANCE SUBSIDIES PROGRAM.
(2) Accounts within the Fund shall contain the money that is intended to
support the purpose for which each account is designated.
(3) Funds received from the distribution of the premium tax under §
6–103.2 of this article shall be placed in the account for Exchange operations and may be
used only for the purpose of funding the operation and administration of the Exchange.
(4) The following funds may be used only for the purposes of funding the
State Reinsurance Program:
(i) any pass–through funds received from the federal government
under a waiver approved under § 1332 of the Affordable Care Act to provide reinsurance to
carriers that offer individual health benefit plans in the State; Ch. 483 2022 LAWS OF MARYLAND
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(ii) any funds designated by the federal government to provide
reinsurance to carriers that offer individual health benefit plans in the State; and
(iii) any funds designated by the State to provide reinsurance to
carriers that offer individual health benefit plans in the State.
(h) (1) Expenditures from the Fund for the purposes authorized by this
subtitle may be made only:
(i) with an appropriation from the Fund approved by the General
Assembly in the State budget; or
(ii) by the budget amendment procedure provided for in Title 7,
Subtitle 2 of the State Finance and Procurement Article.
(2) Notwithstanding § 7–304 of the State Finance and Procurement Article,
if the amount of the distribution from the premium tax under § 6–103.2 of this article
exceeds in any State fiscal year the actual expenditures incurred for the operation and
administration of the Exchange, funds in the Exchange operations account from the
premium tax that remain unspent at the end of the State fiscal year shall revert to the
General Fund of the State.
(3) If operating expenses of the Exchange may be charged to either State
or non–State fund sources, the non–State funds shall be charged before State funds are
charged.
(i) (1) The State Treasurer shall invest the money of the Fund in the same
manner as other State money may be invested.
(2) Any investment earnings of the Fund shall be credited to the Fund.
(3) Except as provided in subsection (h)(2) of this section, no part of the
Fund may revert or be credited to the General Fund or any special fund of the State.
(j) A debt or an obligation of the Fund is not a debt of the State or a pledge of
credit of the State.
31–123.
(A) (1) IN THIS SECTION THE F OLLOWING WORDS HAVE THE MEANINGS
INDICATED.
(2) “PROGRAM” MEANS THE SMALL BUSINESS AND NONPROFIT
HEALTH INSURANCE SUBSIDIES PROGRAM.
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(3) (I) “QUALIFIED EMPLOYER ” MEANS AN EMPLOYER WI TH
FEWER THAN 25 FULL–TIME EQUIVALENT EMPL OYEES.
(II) “QUALIFIED EMPLOYER ” INCLUDES A NONPROFIT
ORGANIZATION EMPLOYER WITH FEWER THAN 25 FULL–TIME EQUIVALENT
EMPLOYEES.
(B) THE EXCHANGE, IN CONSULTATION WITH THE COMMISSIONER AND AS
APPROVED BY THE BOARD, SHALL ESTABLISH AND IMPLEMENT A SMALL BUSINESS
AND NONPROFIT HEALTH INSURANCE SUBSIDIES PROGRAM TO PROVIDE
SUBSIDIES TO QUALIFIE D EMPLOYERS AND THEI R EMPLOYEES FOR THE PURCHASE
OF QUALIFIED HEALTH BENEFIT PLANS ON THE EXCHANGE.
(C) THE PROGRAM REQUIRED UNDE R THIS SECTION SHALL BE DESIGNED
TO REDUCE THE AMOUNT THAT QUALIFIED EMPLO YERS AND THEIR EMPLO YEES PAY
FOR QUALIFIED HEALTH B ENEFIT PLANS ON THE EXCHANGE.
(D) FOR CALENDAR YEARS 2024 THROUGH 2028, THE EXCHANGE, IN
CONSULTATION WITH TH E COMMISSIONER AND AS A PPROVED BY THE BOARD,
SHALL ESTABLISH SUBS IDY ELIGIBILITY AND PAYMENT PARAMETERS F OR THE
PROGRAM.
(E) SUBJECT TO AVAILABLE FUNDS, IN EACH OF FISCAL YE ARS 2023
THROUGH 2029, THE EXCHANGE MAY DESIGNAT E FUNDS FROM THE FUND TO BE
USED FOR THE PROGRAM SO THAT FOR C ALENDAR YEARS 2024 THROUGH 2028 NOT
MORE THAN:
(1) $45,000,000 IN ANNUAL SUBSIDIES MAY BE PROVIDED TO
QUALIFIED EMPLOYERS AND THEIR EMPLOYEES WHO MEET THE SUBSIDY
ELIGIBILITY AND PAYM ENT PARAMETERS ESTAB LISHED UNDER SUBSECT ION (D) OF
THIS SECTION; AND
(2) $3,000,000 MAY BE SPENT IN SMAL L BUSINESS OUTREACH
ACTIVITIES FOR THE P URPOSE OF EDUCAT ING QUALIFIED EMPLOY ERS ABOUT THE
PROGRAM.
(F) ON OR BEFORE JANUARY 1, 2023, THE EXCHANGE SHALL ADOPT
REGULATIONS CARRYING OUT THIS SECTION .
(G) (1) THE EXCHANGE SHALL TRACK ON A MONTHLY BASIS
EXPENDITURES ON SUBS IDIES PROVIDED UNDER THE PROGRAM, INCLUDING:
(I) THE AVERAGE NUMBER O F QUALIFIED EMPLOYER S AND
THEIR EMPLOYEES RECE IVING SUBSIDIES UNDE R THE PROGRAM; AND Ch. 483 2022 LAWS OF MARYLAND
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(II) THE AVERAGE SUBSIDY AMOUNT RECEIVED BY Q UALIFIED
EMPLOYERS AND THEIR EMPLOYEES UNDER THE PROGRAM.
(2) THE INFORMATION TRACKED BY THE EXCHANGE UNDER
PARAGRAPH (1) OF THIS SUBSECTION S HALL BE:
(I) POSTED ON THE WEBSIT E OF THE EXCHANGE;
(II) INCLUDED IN THE ANNU AL REPORT REQUIRED U NDER §
31–119(D) OF THIS SUBTITLE; AND
(III) ON OR BEFORE DECEMBER 1, 2028, REPORTED TO THE
SENATE FINANCE COMMITTEE AND THE HOUSE HEALTH AND GOVERNMENT
OPERATIONS COMMITTEE, IN ACCORDANCE WITH § 2–1257 OF THE STATE
GOVERNMENT ARTICLE.
SECTION 2. 3. AND BE IT FURTHER ENACTED, That this Act shall take effect
October June 1, 2022. It Section 1 of this Act shall remain effective for a period of 7 years
1 year and 1 month and, at the end of September 30, 2029, June 30, 2023, Section 1 of this
Act, with no further action required by the General Assembly, shall be abrogated and of no
further force and effect.
Approved by the Governor, May 16, 2022.