Two instruments answer this question, and they do not give the same list. Florida’s Employee Health Care Access Act names gender, age, family composition, tobacco use and geographic area. The federal small-group rule names whether the coverage is for an individual or a family, rating area, age and tobacco use — and then closes the list to anything else. Both are quoted below with their dates. This page reports the difference between them; it does not resolve it, and no sentence here says which one controls.
What Florida’s statute lists
The operative sentence is Fla. Stat. § 627.6699(6)(b)1, and it applies to small employer health benefit plans issued by small employer carriers on or after January 1, 1994:
“Small employer carriers must use a modified community rating methodology in which the premium for each small employer is determined solely on the basis of the eligible employee’s and eligible dependent’s gender, age, family composition, tobacco use, or geographic area as determined under paragraph (5)(f) and in which the premium may be adjusted as permitted by this paragraph. A small employer carrier is not required to use gender as a rating factor for a nongrandfathered health plan.”
The statute defines its own method. Under § 627.6699(3)(n), modified community rating “means a method used to develop carrier premiums which spreads financial risk across a large population; allows the use of separate rating factors for age, gender, family composition, tobacco usage, and geographic area as determined under paragraph (5)(f); and allows adjustments for: claims experience, health status, or duration of coverage as permitted under subparagraph (6)(b)5.; and administrative and acquisition expenses as permitted under subparagraph (6)(b)5.”
And the factors themselves are not fixed by the state. Under § 627.6699(6)(b)2, “rating factors related to age, gender, family composition, tobacco use, or geographic location may be developed by each carrier to reflect the carrier’s experience. The factors used by carriers are subject to office review and approval.” Two carriers can hold different age factors and both be within the statute.
The Employee Health Care Access Act was enacted in 1992, before the Affordable Care Act, by chapter 92-33, Laws of Florida. Its History line runs to s. 30, ch. 2020-9 — the most recent amendment is from the 2020 session.
What the federal rule lists
45 CFR § 147.102, “Fair health insurance premiums,” governs premium rates for coverage offered in the individual or small group market. Paragraph (a)(1) provides that the rate “may vary with respect to the particular plan or coverage involved only by determining the following”: whether the plan or coverage covers an individual or family; rating area; age, within limits the regulation states and this page does not print; and tobacco use, subject to section 2705 of the Public Health Service Act, also within stated limits.
Then paragraph (a)(2):
“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.”
That is a closing clause. It does not merely omit other factors; it forbids variation by them. The section was last amended on June 18, 2018.
One boundary on the federal rule is worth carrying: 45 CFR § 147.102(h) provides that the section “does not apply to grandfathered health plans in accordance with § 147.140.”
Gender is on one list and not on the other
Set the two texts beside each other and the difference is plain. Florida’s statute names gender among the characteristics a small employer carrier’s modified community rate is built on, in the definition at § 627.6699(3)(n), in the operative sentence at § 627.6699(6)(b)1, in the carrier-factor provision at § 627.6699(6)(b)2, and in the composite rating definition at § 627.6699(6)(b)7. Gender does not appear in the federal permitted list at 45 CFR § 147.102(a)(1), and (a)(2) forbids variation by any factor not described there.
Florida’s own accommodation on the point goes exactly this far: “A small employer carrier is not required to use gender as a rating factor for a nongrandfathered health plan.” Read it closely. It says a carrier does not have to use gender. It does not say a carrier may not. That is a permission to abstain, and turning it into a Florida prohibition would misstate the statute in the opposite direction from the more common error.
So: the Florida sentence is real, current, and quotable. The federal sentence is real, current, and quotable. They are not saying the same thing, and this page is not going to tell you that one has quietly retired the other. The useful move for an employer is not to arbitrate between two texts — it is to ask each carrier quoting your group which factors it actually applies to a group like yours, and to ask it in writing.
Why a carrier may not vary the geographic factor inside a county
Florida’s geographic factor is unusually tightly drawn, and this is one place where the statute answers a practical question outright. Fla. Stat. § 627.6699(5)(f):
“The boundaries of geographic areas used by a small employer carrier must coincide with county lines. A carrier may not apply different geographic rating factors to the rates of small employers located within the same county.”
Two rules in two sentences. Geographic boundaries must follow county lines, so a carrier cannot draw its own map. And within one county, the geographic factor cannot vary at all — not by ZIP code, not by neighborhood, not by which side of a city a worksite sits on.
The practical consequence for a Florida employer is that moving a worksite within its own county cannot change the geographic component of its rate. Moving across a county line is a different matter, because it changes the area.
How the federal rating-area map is drawn in this state
The federal side of geography is the rating area, and Florida’s is drawn at maximum granularity. CMS publishes Florida’s geographic rating areas as 67 areas divided on counties — one area per county, with none holding more than one county. The three-digit ZIP column on that table is empty in every row, which is what the Florida statute would predict: a county cannot be split across rating areas when a carrier may not vary the geographic factor inside one.
It is worth being precise about what this does and does not tell you. It is a structural fact. It says nothing whatsoever about whether a premium in one Florida county is higher, lower or the same as in another, and no source used for this page carries a per-county figure. It also comes without an effective date: the CMS page states no plan-year range and no applicable-plan-year language, and carries only a page-last-modified date of September 10, 2024. That is how it is attributed here, because asserting a plan year the source does not state would be inventing one.
Which address picks your rating area
For a Florida employer with staff spread across several counties, the question of which county applies is answered federally rather than by the state. 45 CFR § 147.102(a)(1)(ii)(B) selects the small-group rating area “using the group policyholder’s principal business address” — the employer’s address, not each employee’s.
The regulation then defines the term rather than leaving it open. Principal business address means the principal business address registered with the state; or, if none is registered, or if the registered one exists solely for service of process and is not a substantial worksite, the business address within the state where the greatest number of employees works. For a network plan whose service area does not include the policyholder’s principal business address, the regulation shifts to the business address within the plan’s service area where the greatest number of employees works, and failing that, to where the greatest number of employees within the service area live or reside.
One warning about vocabulary. This federal “principal business address” test decides which rating area applies. Florida’s § 627.6699(3)(v) requires a small employer to have “its principal place of business in this state,” and that test decides whether the employer is a Florida small employer at all. The phrases are nearly the same and the jobs are not. Do not merge them.
What a carrier may adjust, and when it may not
Florida bounds movement after the rate is set. Under § 627.6699(6)(b)3, a small employer carrier “may not modify the rate for a small employer for 12 months from the initial issue date or renewal date, unless the composition of the group changes or benefits are changed.”
A single exception follows, for an employer enrolling under a previously issued group policy with a common anniversary date, and it comes with two conditions: clear and conspicuous disclosure of the first renewal date and the possibility of an increase, and a demonstration to the Office that administrative efficiencies are achieved and reflected in the rates charged.
Adjustments for claims experience, health status or duration of coverage carry their own limits under § 627.6699(6)(b)5. They may not be charged to individual employees or dependents. They must be applied uniformly to the rates charged for all employees and dependents of the small employer. They may not push a small employer’s rate more than a stated distance from the carrier’s approved rate, and a renewal adjustment on those grounds is capped annually — the statute sets both limits in percentages, and those percentages are not printed here. The same subparagraph permits a credit based on administrative and acquisition expense differences resulting from group size, with those factors also subject to Office review and approval.
Under § 627.6699(6)(b)9, a carrier “shall separate the experience of grandfathered health plans from nongrandfathered health plans for determining rates,” so the two populations are not pooled.
The rules that apply only to the smallest groups
Two provisions single out the bottom of the band. Section 627.6699(6)(b)7 bars composite rating for a small employer with fewer than 10 employees, defining composite rating methodology as one “that averages the impact of the rating factors for age and gender in the premiums charged to all of the employees of a small employer.” Section 627.6699(6)(b)8 permits a carrier to separate the experience of groups with fewer than 2 eligible employees from the 2-to-50 band, subject to ceilings the statute states as percentages that are withheld here.
If your Florida group is very small, those are the two provisions that change the shape of the quote, and they are worth naming when you ask a carrier to explain its methodology.
Who checks the factors
Rating factors in Florida are not self-certified into existence. Section 627.6699(6)(b)2 makes the factors carriers develop “subject to office review and approval,” and the statute also requires each carrier to file an annual actuarial certification with the Office that its rating methods are actuarially sound.
The Office in question is the Florida Office of Insurance Regulation, which under Fla. Stat. § 20.121(3)(a)1 is responsible for activities concerning insurers including rates, policy forms, market conduct and solvency. It sits under the Financial Services Commission, which § 20.121(3) creates within the Department of Financial Services while providing that the commission “shall not be subject to control, supervision, or direction by the Department of Financial Services in any manner.” Rate and form review belongs to the Office; consumer complaints and agent licensing belong to the department. If you want to know who approved the factor behind a Florida quote, the Office is the right answer.
The bottom line
Florida’s Employee Health Care Access Act and the federal small-group rule each set out a list of permitted rating factors, and the two lists are not identical. Both are quoted here with their dates; an employer comparing quotes should ask each carrier which factors it actually applies.
Frequently asked questions
Does gender affect a small-group rate in Florida?
The two texts on the point say different things, and this page reports them rather than resolving them. Fla. Stat. § 627.6699(6)(b)1 requires a modified community rating methodology in which the premium “is determined solely on the basis of the eligible employee’s and eligible dependent’s gender, age, family composition, tobacco use, or geographic area,” and separately provides that “a small employer carrier is not required to use gender as a rating factor for a nongrandfathered health plan.” The federal rule at 45 CFR § 147.102(a)(1) permits variation only by whether the coverage is for an individual or a family, rating area, age, and tobacco use, and (a)(2) provides that the rate “must not vary … by any other factor not described in paragraph (a)(1).” Gender does not appear in the federal list. An employer should ask the carrier which factors it actually applies to a group like theirs.
Can a Florida carrier rate our group on our claims history?
Here too, the two instruments read differently and this page quotes both. Florida’s definition of modified community rating at § 627.6699(3)(n) allows adjustments for claims experience, health status or duration of coverage as permitted under subparagraph (6)(b)5, and (6)(b)5 then constrains them: such adjustments “may not be charged to individual employees or dependents,” must be “applied uniformly to the rates charged for all employees and dependents of the small employer,” and are bounded by limits the statute states in percentages this page does not print. The federal rule’s permitted list at 45 CFR § 147.102(a)(1) does not include claims experience, health status or duration of coverage, and (a)(2) closes that list. Ask the carrier what it applies.
We have employees in three Florida counties. Which one sets our rating area?
For the small group market, 45 CFR § 147.102(a)(1)(ii)(B) selects the rating area “using the group policyholder’s principal business address,” not each employee’s home address. The same provision defines principal business address as the one registered with the state, or — where none is registered, or where the registered one exists only for service of process and is not a substantial worksite — the business address within the state where the greatest number of employees works. For a network plan whose service area does not include that address, the regulation gives further fallbacks. Florida then supplies the boundaries: § 627.6699(5)(f) requires geographic areas used by a small employer carrier to coincide with county lines.
Can our rate change in the middle of a policy year?
Florida bounds this directly. Fla. Stat. § 627.6699(6)(b)3 provides that small employer carriers “may not modify the rate for a small employer for 12 months from the initial issue date or renewal date, unless the composition of the group changes or benefits are changed.” There is one narrow exception written into the same subparagraph, for a small employer enrolling under a previously issued group policy with a common anniversary date for all employers covered under it: the carrier may modify the rate one time within those 12 months, but only if it discloses the date of the first renewal and the possibility of an increase to the employer in a clear and conspicuous manner, and demonstrates to the Office that administrative efficiencies are achieved and reflected in the rates.
What is composite rating, and does it apply to a small Florida group?
Florida defines it and then restricts it. Under § 627.6699(6)(b)7, composite rating methodology means “a rating methodology that averages the impact of the rating factors for age and gender in the premiums charged to all of the employees of a small employer,” and the same subparagraph provides that small employer carriers “may not use a composite rating methodology to rate a small employer with fewer than 10 employees.” So for the smallest Florida groups, the statute forecloses the averaging approach rather than leaving it to the carrier.
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 Florida’s modified community rating statute alongside the federal small-group rating rule with employers who want to know what is driving a quote. Start with the Wexford Health Insurance quote form.