Massachusetts Division of Health Care Finance and Policy Issues Final Rule Clarifying Application of the Fair Share Contribution Requirement under the Massachusetts Health Care Reform Act


The Massachusetts Health Care Reform Act (the Act) requires employers with 11 or more employees at Massachusetts locations to (among other things) make a “fair and reasonable” contribution to the health care premium costs of its employees or, alternatively, pay an annual “fair share contribution” (FSC) to the Commonwealth of $295 per employee. Enforcement of the FSC rules is split between two agencies: the Division of Health Care Finance and Policy (DHCFP) establishes rules relating to what constitutes a fair and reasonable contribution, and the Division of Unemployment Assistance (DUA) oversees compliance.

Effective October 1, 2009, the DHCFP issued a revised final FSC testing rule (the “final rule”) that was originally proposed on August 13, 2009. Please see An Employer’s Guide to the 2006 Massachusetts Health Care Reform Act for a comprehensive explanation of the impact of the Act on employers with employees at Massachusetts locations.

The final rule makes a handful of modest, though potentially important, changes to the FSC testing rules. After providing a brief summary of the FSC testing regime, this client advisory explains the key features of the newly issued DHCFP final rule and its consequences.

Please see full advisory below for more information.

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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