Key Takeaways
- Michigan group health insurance is regulated under both state and federal law (ERISA, ACA)
- COBRA continuation coverage applies to employers with 20 or more employees
- Michigan has state continuation coverage for employers with fewer than 20 employees
- Small group defined as 1-50 employees in Michigan
- Mental health parity requirements apply to group health plans
Michigan Group Health Insurance
Michigan group health insurance is heavily regulated at both state and federal levels to protect employees and their dependents.
Regulatory Framework
| Regulation | Applies To |
|---|---|
| ERISA | Most private employer plans |
| ACA | All health plans |
| Michigan Insurance Code | Insured group plans |
| Michigan HMO Act | HMO group plans |
Group Size Definitions
Michigan uses these group size definitions:
| Market Segment | Employee Count |
|---|---|
| Small Group | 1-50 full-time equivalent |
| Large Group | 51 or more full-time equivalent |
Small Group Requirements
Michigan small group health insurance must provide:
- Guaranteed issue (cannot deny coverage)
- Community rating (limited health-based rates)
- Essential health benefits
- Mental health parity
- No pre-existing condition exclusions
COBRA Continuation Coverage
The federal COBRA law requires continuation coverage:
COBRA Basics
| Aspect | Requirement |
|---|---|
| Applies To | Employers with 20+ employees |
| Duration | 18-36 months depending on event |
| Premium | Up to 102% of group rate |
| Coverage | Same as active employees |
Qualifying Events
| Event | Duration |
|---|---|
| Employment termination | 18 months |
| Reduced hours | 18 months |
| Divorce/legal separation | 36 months |
| Death of employee | 36 months |
| Medicare entitlement | 36 months |
| Dependent child aging out | 36 months |
Exam Tip: COBRA applies to employers with 20 or more employees. For smaller employers, Michigan provides state continuation coverage.
Michigan State Continuation Coverage
For employers with fewer than 20 employees, Michigan provides continuation coverage:
State Continuation Coverage
| Aspect | Michigan Requirement |
|---|---|
| Applies To | Employers not subject to COBRA |
| Duration | Varies by circumstance |
| Premium | At group rate |
| Coverage | Continuation of group benefits |
When State Continuation Applies
- Employee loses coverage due to termination or reduced hours
- Dependent loses coverage due to qualifying event
- Not eligible for COBRA
Mental Health Parity
Michigan requires mental health parity in group health plans:
Parity Requirements
| Aspect | Must Be Equal |
|---|---|
| Copays | Same as medical/surgical |
| Deductibles | Same as medical/surgical |
| Annual Limits | Same as medical/surgical |
| Lifetime Limits | Same as medical/surgical |
| Treatment Limits | Same as medical/surgical |
Covered Conditions
Michigan mental health parity applies to:
- All mental health conditions
- Substance use disorders
- Behavioral health conditions
HIPAA Portability
Group health plans must comply with HIPAA portability:
Key HIPAA Provisions
- Cannot deny enrollment based on health status
- Must provide certificate of creditable coverage
- Limits pre-existing condition exclusions
- Protects against discrimination
What is the minimum employer size for federal COBRA to apply?
What does mental health parity require in Michigan group health plans?
What is the definition of a small group in Michigan?