Saturday, 22 September, 2018

Trump administration finalizes expansion of association health plans

Trump administration finalizes rule to allow for skimpier health plans Trump administration finalizes expansion of association health plans
Melissa Porter | 22 June, 2018, 22:57

"Many of our laws, particularly Obamacare, make healthcare coverage more expensive for small businesses than large companies", Acosta said.

Acosta's central talking point in the announcement was that the expansion of these plans will "level the playing field" between health insurance rules that apply to large companies and ones that pertain to small businesses. She said the Wilmington Chamber of Commerce is excited about the possibilities AHPs could bring for small businesses, as many of them have struggled to remain competitive under the Affordable Care Act. America's Health Insurance Plans (AHIP) put out a statement with some reservations, noting that the rule could "lead to higher premiums for consumers who depend on the individual or small group market for their coverage" and "may put consumers at greater risk of fraudulent actors entering this market" (see AHIP Comments on Final Rule Expanding the Use of Association Health Plans).

"Under Obamacare, small business owners in our state have struggled to find affordable health insurance choices for their employees and their employees" families", Doak said.

Small businesses and franchisees have historically been excluded from the employer-benefits market, forcing millions of employees to pay for their own healthcare and other related benefits.

Supporters say the proposal would allow people and businesses to join associations even if they are working in different states.

Republicans repealed the ACA's so-called individual mandate, the requirement that most Americans purchase health insurance or else pay a fine, in an overhaul of the USA tax code past year.

The Trump administration said that antidiscrimination protections that apply to large employer health plans will also apply with the AHPs.

On Tuesday, Dawn Sweeney, president of the National Restaurant Association, which has long pressed for broader access to association health plans, said "small restaurant owners from Nevada to North Carolina will now be able to purchase high quality insurance for a more affordable price".

However, the rule has already been challenged by attorneys general in NY and MA, who filed suit to block the administration from offering plans that don't cover all of the ACA's essential health benefits. In addition, the CBO also noted that about 10% of the 4 million people buying these plans in 2023 and beyond would have been uninsured otherwise.

Despite the promising new opportunities for AHPs, the regulations expressly state that the new guidance does not modify existing state authority to regulate MEWAs. "This final rule provides an additional mechanism for groups or associations to meet the definition of an "employer" and sponsor a single ... group health plan; it is not the sole mechanism". This means four million people who are underinsured - as well as a continued rise in premiums for those individuals who maintain their PPACA insurance plans. It has estimated that average premiums for those buying small-group and individual plans will go up by 2 to 3 percent because of healthy people leaving those markets for association and short-term plans.

"Consumers are always looking for a new low-priced health insurance option", Avalere President Dan Mendelson said in February, "but migration of healthy people to a new product will ultimately take a toll on what is presently being sold in the market".

The AHP rule does not preempt state laws, so states may continue to regulate AHPs as multiple employer welfare arrangements, whether fully insured or self-funded.