No. 2 Page 1 of 9
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No. 2. An act relating to unmerging the individual and small group health
insurance markets.
(H.35)
It is hereby enacted by the General Assembly of the State of Vermont:
Sec. 1. 33 V.S.A. § 1802 is amended to read:
§ 1802. DEFINITIONS
As used in this subchapter:
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(5) “Qualified employer”:
(A) means an entity that employed an average of not more than 50
100 employees on working days during the preceding calendar year and that:
(i)(A) has its principal place of business in this State and elects to
provide coverage for its eligible employees through the Vermont Health
Benefit Exchange, regardless of where an employee resides; or
(ii)(B) elects to provide coverage through the Vermont Health
Benefit Exchange for all of its eligible employees who are principally
employed in this State;
(B) on and after January 1, 2016, shall include an entity that:
(i) employed an average of not more than 100 employees on
working days during the preceding calendar year; and
(ii) meets the requirements of subdivisions (A)(i) and (A)(ii) of this
subdivision (5).
(C) [Repealed.] No. 2 Page 2 of 9
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Sec. 2. 33 V.S.A. § 1804 is amended to read:
§ 1804. QUALIFIED EMPLOYERS
(a)(1) Until January 1, 2016, a qualified employer shall be an entity that
employed an average of not more than 50 employees on working days during
the preceding calendar year, and the term “qualified employer” includes self-
employed persons to the extent permitted under the Affordable Care Act.
Calculation of the number of employees of a qualified employer shall not
include a part-time employee who works fewer than 30 hours per week or a
seasonal worker as defined in 26 U.S.C. § 4980H(c)(2)(B).
(2) An employer with 50 or fewer employees that offers a qualified
health benefit plan to its employees through the Vermont Health Benefit
Exchange may continue to participate in the Exchange even if the employer’s
size grows beyond 50 employees, as long as the employer continuously makes
qualified health benefit plans in the Vermont Health Benefit Exchange
available to its employees. [Repealed.]
(b)(1) On and after January 1, 2016, a A qualified employer shall be an
entity that employed an average of not more than 100 employees on working
days during the preceding calendar year, and the term “qualified employer”
includes self-employed persons to the extent permitted under the Affordable
Care Act. The number of employees shall be calculated using the method set
forth in 26 U.S.C. § 4980H(c)(2). No. 2 Page 3 of 9
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(2) An employer with 100 or fewer employees that offers a qualified
health benefit plan to its employees through the Vermont Health Benefit
Exchange may continue to participate in the Exchange even if the employer’s
size grows beyond 100 employees, as long as provided the employer
continuously makes qualified health benefit plans in the Vermont Health
Benefit Exchange available to its employees.
(c) [Repealed.]
Sec. 3. 33 V.S.A. § 1805 is amended to read:
§ 1805. DUTIES AND RESPONSIBILITIES
The Vermont Health Benefit Exchange shall have the following duties and
responsibilities consistent with the Affordable Care Act:
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(7) transferring to the Secretary of the U.S. Department of the Treasury
the name and taxpayer identification number of each individual who was an
employee of an employer but who was determined to be eligible for the
premium tax credit under Section 36B of the Internal Revenue Code of 1986,
including each individual who was an employee of an employer but who was
determined to be eligible for the premium tax credit for one of the following
reasons:
(A) the employer did not provide minimum essential coverage; or
(B) the employer provided the minimum essential coverage, but it
was determined under Section 36B(c)(2)(C) of the Internal Revenue Code to No. 2 Page 4 of 9
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be either unaffordable to the employee or not to provide the required minimum
actuarial value;
* * *
(9)(A) transferring to the Secretary of the U.S. Department of the
Treasury the name and taxpayer identification number of each individual who
notifies the Vermont Health Benefit Exchange that he or she has changed
employers and of each individual who ceases coverage under a qualified health
benefit plan during a plan year and the effective date of that cessation; and
(B) communicating to each employer the name of each of its
employees and the effective date of the cessation reported to the U.S.
Department of the Treasury under this subdivision;
* * *
(17) establishing procedures, including payment mechanisms and
standard fee or compensation schedules, that allow licensed insurance agents
and brokers to be appropriately compensated outside the navigator program
established in section 1807 of this title for:
(A) assisting assist with the enrollment of qualified individuals and
qualified employers in any qualified health plan offered through the Exchange
for which the individual or employer is eligible; and
(B) assisting assist qualified individuals in applying for premium tax
credits and cost-sharing reductions for qualified health benefit plans purchased
through the Exchange. No. 2 Page 5 of 9
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Sec. 4. 33 V.S.A. § 1811 is amended to read:
§ 1811. HEALTH BENEFIT PLANS FOR INDIVIDUALS AND SMALL
EMPLOYERS
(a) As used in this section:
(1) “Health benefit plan” means a health insurance policy, a nonprofit
hospital or medical service corporation service contract, or a health
maintenance organization health benefit plan offered through the Vermont
Health Benefit Exchange or a reflective health benefit plan offered in
accordance with section 1813 of this title that is issued to an individual in the
individual market or to an employee of a small employer in the small group
market. The term does not include coverage only for accident or disability
income insurance, liability insurance, coverage issued as a supplement to
liability insurance, workers’ compensation or similar insurance, automobile
medical payment insurance, credit-only insurance, coverage for on-site
medical clinics, or other similar insurance coverage in which benefits for
health services are secondary or incidental to other insurance benefits as
provided under the Affordable Care Act. The term also does not include stand-
alone dental or vision benefits; long-term care insurance; short-term, limited-
duration health insurance; specific disease or other limited benefit coverage;
Medicare supplemental health benefits; Medicare Advantage plans; and other
similar benefits excluded under the Affordable Care Act. No. 2 Page 6 of 9
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(2) “Registered carrier” means any person, except an insurance agent,
broker, appraiser, or adjuster, who issues a health benefit plan and who has a
registration in effect with the Commissioner of Financial Regulation as
required by this section.
(3)(A) Until January 1, 2016, “small employer” means an entity that
employed an average of not more than 50 employees on working days during
the preceding calendar year. The term includes self-employed persons to the
extent permitted under the Affordable Care Act. Calculation of the number of
employees of a small employer shall not include a part-time employee who
works fewer than 30 hours per week or a seasonal worker as defined in 26
U.S.C. § 4980H(c)(2)(B). An employer may continue to participate in the
Exchange even if the employer’s size grows beyond 50 employees, as long as
the employer continuously makes qualified health benefit plans in the Vermont
Health Benefit Exchange available to its employees.
(B) Beginning on January 1, 2016, “small “Small employer” means
an entity that employed an average of not more than 100 employees on
working days during the preceding calendar year. The term includes self-
employed persons to the extent permitted under the Affordable Care Act. The
number of employees shall be calculated using the method set forth in 26
U.S.C. § 4980H(c)(2). An employer may continue to participate in the
Exchange even if the employer’s size grows beyond 100 employees, as long as No. 2 Page 7 of 9
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provided the employer continuously makes qualified health benefit plans in the
Vermont Health Benefit Exchange available to its employees.
(b)(1) To the extent permitted by the U.S. Department of Health and
Human Services, an An individual may purchase a health benefit plan through
the Exchange website, through navigators, by telephone, or directly from a
registered carrier under contract with the Vermont Health Benefit Exchange, if
the carrier elects to make direct enrollment available. A registered carrier
enrolling individuals in health benefit plans directly shall comply with all open
enrollment and special enrollment periods applicable to the Vermont Health
Benefit Exchange.
(2) To the extent permitted by the U.S. Department of Health and
Human Services, a A small employer or an employee of a small employer may
purchase a health benefit plan through the Exchange website, through
navigators, by telephone, or directly from a registered carrier under contract
with the Vermont Health Benefit Exchange.
(3) No person may provide a health benefit plan to an individual or to a
small employer unless the plan complies with the provisions of this subchapter.
(c) No person may provide a health benefit plan to an individual or to a
small employer unless such person is a registered carrier. The Commissioner
of Financial Regulation shall establish, by rule, the minimum financial,
marketing, service, and other requirements for registration. Such registration
shall be effective upon approval by the Commissioner of Financial Regulation No. 2 Page 8 of 9
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and shall remain in effect until revoked or suspended by the Commissioner of
Financial Regulation for cause or until withdrawn by the carrier. A carrier
may withdraw its registration upon at least six months’ prior written notice to
the Commissioner of Financial Regulation. A registration filed with the
Commissioner of Financial Regulation shall be deemed to be approved unless
it is disapproved by the Commissioner of Financial Regulation within 30 days
of filing.
(d)(1) Guaranteed issue.
(A) A registered carrier shall guarantee acceptance of all individuals,
small employers, and employees of small employers, and each dependent of
such individuals and employees, and their dependents for any health benefit
plan offered by the carrier in the individual market, regardless of any
outstanding premium amount a subscriber may owe to the carrier for coverage
provided during the previous plan year.
(B) A registered carrier shall guarantee acceptance of all small
employers, their employees, and their employees’ dependents for any health
benefit plan offered by the carrier in the small group market, regardless of any
outstanding premium amount a subscriber may owe to the carrier for coverage
provided during the previous plan year.
* * *
(f)(1) A registered carrier shall use a community rating method acceptable
to the Commissioner of Financial Regulation for determining premiums for No. 2 Page 9 of 9
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health benefit plans and shall determine the premiums for the carrier’s
individual market plans separately from the premiums for its small group
market plans. Except as provided in subdivision (2) of this subsection, the
following risk classification factors are prohibited from use in rating
individuals, small employers, or employees of small employers, or the
dependents of such individuals or employees:
* * *
(k) The guaranteed acceptance provision of subsection (d) of this section
shall not be construed to limit an employer’s discretion in contracting with his
or her the employer’s employees for insurance coverage.
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Sec. 5. EFFECTIVE DATE
This act shall take effect on January 1, 2026.
Date Governor signed bill: February 19, 2025