Now that President Obama has signed the Protecting Affordable Coverage for Employees Act (PACE), attention turns to implementation of the legislation that gives states broader flexibility in determining how to treat small businesses.

The bill scrapped a provision of the Patient Protection and Affordable Care Act which would have moved firms with between 51 and 100 employees into the small group health insurance market beginning in 2016. Instead, states can decide whether or not such companies will be moved into that category, along with smaller firms.

Read: Senate passes PPACA group definition bill by a voice vote

Anthem, formerly Blue Cross of California, released a memo predicting how different states will react to the new law. According to the insurer, California, Colorado, New York and Virginia will likely move forward with the process originally called for by the PPACA. Those states have already enacted legislation to include all firms with fewer than 100 employees in the small group market.

In contrast, Anthem lists 10 states that it anticipates will continue the original definition of a small group, which is employers with between one and 50 eligible employees. That group includes Connecticut, Georgia, Indiana, Kentucky, Maine, Missouri, Nevada, New Hampshire, Ohio and Wisconsin.

Notably, the different approaches anticipated from states do not follow easily-identifiable political divisions. While all four states that will expand the definition have Democratic governors, all except California have at least one chamber of the legislature controlled by Republicans.

Similarly, the states that will likely keep the current restrictions on the small group market are run by both Democrats and Republicans.

As Republicans have gradually shifted attention away from PPACA in favor of other issues, the country has seen more evidence of collaboration between the two parties at both the national and state level to improve the law.

The PACE Act, which passed Congress with overwhelming bipartisan support, is the 14th bill President Obama has signed to make small changes to the original bill passed in 2010.

Furthermore, the Republican-controlled Montana legislature voted earlier this year to join the federally-funded Medicaid expansion that the state had previously rejected, while the independent governor of Alaska, Bill Walker, has also expanded Medicaid for his state. Other GOP-run states have sought federal waivers to expand Medicaid through models slightly different than that called for by the feds.

Instant Insights /

Anthem predicts effects of PPACA small-group mandate repeal

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