On June 6, the House Education & the Workforce Committee approved H.R.2868, the Association Health Plans Act (AHPA). The committee also favorably reported another health-related bill, H.R. 2813, the Self Insurance Protection Act (SIPA).
The AHP bill expands association health plans by amending ERISA (the statute governing welfare benefit plans) to allow a group of employers to band together to sponsor a welfare benefit plan that is a group health plan regardless of whether the participating employers are in the same industry. Self-employed individuals can qualify as a participating employer. And, the bill allows establishment of an AHP with only self-employed individuals participating. Under the bill, the AHP must provide coverage to at least 51 employees (and all the employees of the participating employers can be aggregated to reach the 51-employee threshold) and to no one else outside of the association. The association sponsoring the AHP must be at least two years old and must have been established “in good faith” for reasons other than providing health care coverage.
Other conditions include a requirement that membership in the group or association cannot be conditioned on any health status-related factor, and a rule that makes health coverage available to all employer members of the association regardless of any health status-related factor. The bill also includes governance requirements, and authority to set actuarially-sound premium rates using a modified community rating methodology. The bill expressly prohibits any health insurer from sponsoring an AHP. However, the bill does allow health insurers (and their affiliates) to participate in an AHP, and to “provide services such as assistance with plan development, marketing, and administrative services” to an AHP.
The SIPA “protects small business’ access to stop-loss insurance, the committee said. The bill does that by excluding stop-loss insurance from the definition of “health insurance."
Prospects: Both the AHPA and the SIPA are partisan bills that may well pass the House, but neither is likely to be considered in the Senate.
NAIFA Staff Contact: Michael Hedge – Senior Director – Government Relations, at mhedge@naifa.org.