Yes, in a specific and limited way. County is part of what a Tennessee small-group health rate is built from, because Tennessee’s geographic rating areas are drawn on county lines and on nothing else. But two things narrow that immediately. The county that matters is not where your employees live — it is the county attached to a single address, the one the federal rule calls the group policyholder’s principal business address. And a different county is not automatically a different rating area: on the Tennessee Geographic Rating Areas table, Tennessee’s 95 counties are gathered into 8 areas, so a county line in this state can run inside an area rather than between two, and crossing one of those changes nothing at all.
That makes “does my county change what I pay” a question with a structural answer rather than a numeric one. This page gives you the structure: how the areas are drawn, which address selects one, what else may legally move a rate alongside geography, and the places in Tennessee where a city limit and a rating-area boundary do not agree.
Tennessee draws its rating areas on counties, with no zip-code overlay
CMS publishes the Tennessee Geographic Rating Areas table, and its shape is the whole story: every one of Tennessee’s 95 counties appears on it, each on exactly one row, 95 distinct county names, gathered into 8 rating areas. No county appears twice. There is no residual category, no partial county, and no county left off.
The table also carries a column headed “3 Digit Zip Code(if applicable)”
, and on Tennessee’s rows that column is empty throughout — not one of the 95 rows carries a zip value. CMS’s parent page, State Specific Geographic Rating Areas, states Tennessee’s division method in a single word: Counties. Three separate confirmations point the same way, so the county name really is the entire geography here. A zip code tells you something about a Tennessee rate only to the extent that it tells you which county the address is in.
One caveat about the table travels with everything below. Its own stamp reads “Page Last Modified: 09/10/2024”
, and it states no effective plan year anywhere on its face. So the honest description is that this is CMS’s published record of how Tennessee’s areas are drawn, not a live feed, and this page does not tell you which plan years the drawing attaches to, because the source does not either.
The address that selects your area is the employer’s, and there is only one of it
This is the part that surprises employers most often, so it is worth having in the regulation’s own words. 45 CFR 147.102(a)(1)(ii)(B):
In the small group market, using the group policyholder’s principal business address. For purposes of this paragraph (a)(1)(ii)(B), principal business address means the principal business address registered with the State or, if a principal business address is not registered with the State, or is registered solely for purposes of service of process and is not a substantial worksite for the policyholder’s business, the business address within the State where the greatest number of employees of such policyholder works.
Read that as a cascade, because that is how it operates. The registered principal business address governs first. If there is no registered principal business address, or if the registered one is a service-of-process shell rather than a substantial worksite, the rule moves to the in-state business address where the most employees work. The same paragraph then adds a further step reserved for network plans: where the policyholder’s principal business address falls outside a network plan’s service area and the policyholder has employees who live, reside or work inside it, the rating area for that plan is taken from the in-state business address inside the service area with the greatest number of employees, and if there is no such business address, from where the greatest number of employees inside the service area live or reside at the beginning of the plan year.
The practical upshot: a Tennessee employer with staff scattered across half a dozen counties has one rating area, not six. The group is rated as a group, from one address.
Geography is one item on a closed list
Rating area does not sit alone, and it also does not sit on an open-ended list of things an issuer may consider. 45 CFR 147.102(a)(1) permits a small-group rate to vary by only four things: whether the coverage is individual or family; rating area; age; and tobacco use. The closing clause of the same section is the sentence the whole structure turns on:
The rate must not vary with respect to the particular plan or coverage involved by any other factor not described in paragraph (a)(1) of this section.
Age and tobacco use are each permitted only within a federally capped band, and the caps are not printed on this page. What matters for a county question is what is absent from the list. Employee health history is not a permitted rating factor. Neither is industry, claims experience, or the size of the group. When a Tennessee employer asks whether moving offices will change the rate, geography is genuinely one of the levers — and it is one of very few.
What CMS records about Tennessee’s own rating elections
Several of these factors can be adjusted by a state. States may establish their own uniform age rating curve, their own age or tobacco ratio, their own uniform family tiers, or require issuers to average enrollee premiums. CMS maintains a state-by-state table, Market Rating Reforms — State Specific Rating Variations, recording which states have done so, and those columns are genuine enumerations — other states’ cells in them are populated.
CMS’s state-by-state table records no Tennessee entry in any of those columns, and the table’s own legend resolves what that means: “If a cell is blank or a state is not listed, the federal default applies.” Read positively, Tennessee is not among the states CMS lists as having established one of those variations, so on those factors the federal default is what governs. That is why a Tennessee county question is answered out of the federal rating rule rather than out of a Tennessee-specific rating formula. The same vintage caution applies — this page was last modified 09/10/2024, and it should be attributed as CMS’s published record rather than as real-time currency.
A city limit and a county line are not the same line
Tennessee is unusually good at demonstrating this, and the demonstrations run in both directions.
Nashville runs them together. It is not a city sitting inside a county — it is the Metropolitan Government of Nashville and Davidson County, chartered under TCA 7-1-101 et seq., and the University of Tennessee’s Municipal Technical Advisory Service records its municipality type as Metro where other Tennessee markets read City. The municipal boundary and the county boundary are the same line, so no address inside Nashville falls in a different rating area from any other address inside Nashville.
Knoxville pulls the other way and gets the same result. Its rating area absorbs whole both of the county-straddling cities on its edge: Oak Ridge, which lies in Anderson and Roane counties, and Farragut, which extends from Knox into Loudon. CMS places Knox, Anderson, Roane and Loudon in one area, so a group with its principal business address in Knoxville, in Oak Ridge, or in Farragut is rated on the same geography whichever county that address falls in. A county line running through a city carries no rating consequence there at all.
Johnson City is the widest spread of any Tennessee market we track. Its limits reach into Carter, Sullivan and Washington counties, and it is the county seat of none of them — Washington County’s seat is Jonesborough, Carter County’s is Elizabethton, and Sullivan County’s is Blountville, which the Tennessee Blue Book records as unincorporated. CMS places all three counties in a single rating area, so an employer there can hold its principal business address on either side of either county line inside the city and be rated on the same geography.
Spring Hill sits on the boundary, and this page will not resolve it
Then there is the exception. Spring Hill lies in two counties, Maury and Williamson, and CMS places them in different rating areas. The rating-area boundary runs through the city.
Two Tennessee state sources agree on the split. The Municipal Technical Advisory Service records the city’s counties as Maury, Williamson. The Tennessee Blue Book lists Spring Hill twice in its municipalities-by-county section — under Maury as Spring Hill (Williamson), and under Williamson as Spring Hill (Maury) — beneath a legend marking municipalities located in more than one county.
Which rating area a given Spring Hill employer falls into is not something this page can tell you, and the reason is worth stating plainly rather than hedging. The determinant is federal, not municipal: 45 CFR 147.102(a)(1)(ii)(B), applied to that specific employer’s own principal business address, with the fallback cascade above sitting behind it. Two employers inside the same city limits can be rated on different geography. An employer that relocates across town can change its geographic factor without ever leaving Spring Hill. The table gives two areas for two counties; the rule gives one address per group. The answer belongs to the address, and a page cannot have your address.
Two things follow that are worth saying out loud. First, different is not higher or lower. The CMS table contains no prices and draws no comparison between areas, so a change in geographic factor has no direction on its face, and nobody should infer one from the fact of a boundary. Second, Spring Hill is the only market on this brand’s Tennessee market page whose counties fall in different rating areas, but it is not the only such municipality in the state — Grand Junction, in Fayette and Hardeman, and Tullahoma, in Coffee and Franklin, straddle a line too. That is a hand-verified pair, not a statewide count, and it is deliberately not presented as one.
Sharing a rating area is not the same as sharing a market
The reverse trap is just as common: assuming that two places with obviously different economies must be rated on different geography.
Clarksville is the county seat of Montgomery County, and CMS places Montgomery in the same rating area as Davidson. Clarksville therefore lies wholly inside Nashville’s rating geography while being a separate city, a separate labor market and a separate commuting shed. An employer that opens a second location in the other city, or moves its principal business address between the two, changes nothing about its geographic factor. A rating area is not a commuting shed, and distance from a metropolitan center does not enter it.
West Tennessee splits the other way. Memphis is the county seat of Shelby County, and CMS places Shelby in an area it shares only with Fayette, Haywood, Lauderdale and Tipton. Jackson, the county seat of Madison County, sits in the other West Tennessee area — the one that does not contain Shelby. Those two areas between them account for the whole of the western grand division and nothing outside it. So an employer with sites in Jackson and in Memphis faces two different geographic factors inside a single grand division, and which one applies is settled by whichever address is the principal business address.
Chattanooga makes the sharpest version of the point, because its rating area does not respect Tennessee’s own statutory regional boundary. CMS groups Hamilton with Franklin, Grundy and Sequatchie — counties the Tennessee Code assigns to the middle grand division, while Hamilton itself sits in the eastern one (Tennessee Blue Book, The Three Grand Divisions, pursuant to Tennessee Code Annotated Title 4, Chapter 1, Part 2). Which part of Tennessee an employer is in and which rating area it is in are different questions with different answers.
What the table does not tell you, and what to do instead
The CMS rating-area table is a map, not a price list. It contains no premiums, no factors, no ranking of one area against another, and no plan year. What it gives you is a clean answer to one narrow question: which rating area does this county belong to. That question is worth answering precisely, because it is one of only four things a small-group rate may vary on, and it is the only one of the four that an employer can move.
So the practical sequence for a Tennessee employer is short. Identify the address the federal rule will actually use, which is the registered principal business address unless the registration test fails. Find that address’s county. Look the county up on the table. If you are near a county line, or inside a city that straddles one, treat the address as the question rather than the city. And where a quote turns on which side of a line you are on, resolve it with the address, the issuer and the Insurance Division — not with an assumption about which side ought to be better.
The bottom line
County is part of a Tennessee small-group rate, but the county that counts is the one attached to a single address — the group policyholder’s principal business address. A county line can sit inside a rating area and change nothing, or run between two areas and change the geographic factor.
Frequently asked questions
My employees live in several different Tennessee counties. Does that split my rate?
No. In the small group market the rating area is not assembled from where employees live. The federal rule at 45 CFR 147.102(a)(1)(ii)(B) sets it “In the small group market, using the group policyholder’s principal business address.” That is one address for the whole group, and the group is the policyholder — the employer. Where employees live becomes relevant only at the far end of the rule’s fallback cascade, in the narrow case of a network plan whose service area does not contain the employer’s principal business address and where no qualifying in-state business address exists inside that service area.
I run two Tennessee locations in different counties. Which one is the rating address?
The rule works in order. First, the principal business address registered with the state. If no principal business address is registered with the state, or if the registered one exists solely for service of process and is not a substantial worksite for the business, the rule moves to the business address within the state where the greatest number of employees works. A separate step applies only to network plans whose service area does not reach the principal business address. So the answer is not “whichever location is bigger” by default — the registered address governs first, and headcount only comes in when the registration test does not resolve it.
If I move my office across a county line, does my rating area change?
Only if the new county sits in a different rating area. Tennessee’s 95 counties are gathered into a smaller number of rating areas on the CMS table, so a county line in this state can run inside an area rather than between two, and crossing one of those changes nothing about the geographic factor. Knoxville is a clear case: CMS places Knox, Anderson, Roane and Loudon together, so an address in Oak Ridge or Farragut is on the same rating geography as one in Knoxville whichever county it falls in. Check the county against the table rather than assuming a move matters.
My business is in Spring Hill. Which rating area is that?
We are not going to answer that, and not for lack of looking. Spring Hill lies in Maury and Williamson counties, and CMS places those two counties in different rating areas — the boundary runs through the city. The determinant is not municipal. It is 45 CFR 147.102(a)(1)(ii)(B) applied to one specific employer’s principal business address, with the fallback cascade behind it. Two employers inside the same Spring Hill city limits can be rated on different geography. Anyone who answers this question without knowing your address is guessing.
Does Tennessee use zip codes to draw rating areas?
Not on the CMS table. The table carries a column headed “3 Digit Zip Code(if applicable)” and no Tennessee row carries a value in it — the column is empty across all 95 county rows. CMS’s parent page for geographic rating areas gives Tennessee’s division method as Counties. So for Tennessee the county name is the whole of the geography, and a zip code is at best a proxy for the county it sits in.
About the author
Nate Jones, CPCU, is the founder of Wexford Insurance and Wexford Health Insurance, an independent agency placing small-business group benefits in 9 states. He reads the CMS Tennessee rating-area table county by county with employers whose principal business address sits near a county line. Start with the Wexford Health Insurance quote form.