Blue Cross Revises Underwriting Checklist for Small Groups

A Message From Blue Cross Blue Shield of Louisiana:

Thank you for your patience as we work through updating our small group underwriting process to ensure it meets both federal and state law. As mentioned in our last message to you, today’s message includes our checklist that will guide our process in offering coverage for your small group clients.

As you know, Louisiana Department of Insurance issued Advisory Letter 2020-02 on April 22, 2020, stating that Louisiana’s Insurance Code impliedly permits a small group policy to be issued to a two-member group whose only two members are spouses if the group has at least one employee. The employee can be one of the spouses if the group can produce sufficient documentation of the status of the employee spouse.

Federal law differs some in this area. In order to comply with both the Louisiana Insurance Code and federal law, we will write small group coverage for a two-person group that is wholly owned by spouses if the group can produce documentation that one of the spouses is an employee of the group. That documentation may include:

1. The capacity in which the spouse is employed (such as a W‑2, Form 941, L‑1, and/​or SUTA);
2. The job title, job duties and responsibilities of the spouse;
3. The location where the spouse performs his or her job duties; and
4. Any special training or licensure necessary for the employee-spouse position.

We designed this checklist to help you determine if a group qualifies for small group coverage. The checklist is required for our updated underwriting process.

We will give 90 days’ notice prior to nonrenewal of groups that do not meet small group qualifications so they can take action to meet the qualifications or choose another coverage option.

Questions? Call Us.