Labor Rules Allows Skimpy ‘Association Health Plans’

By SETH SANDRONSKY

President Trump’s Department of Labor on June 19 issued a final rule that allows small business groups to offer health-care insurance plans, e.g., Association Health Plans (AHP). This action ignores some provisions of the 2010 Affordable Care Act, or Obamacare.

America’s Health Insurance Plans, a national trade association, urged caution over the Labor Department’s new rule. “We remain concerned that broadly expanding the use of AHPs may lead to higher premiums for consumers who depend on the individual or small group market for their coverage,” said Kristine Grow, senior vice president of communications for AHIP, in a statement. “Ultimately, the rule could result in fewer insured Americans and may put consumers at greater risk of fraudulent actors entering this market.”

Anthony Wright helms Health Access California, a consumer group in the bluest and most populous state. “President Trump promised to deliver ‘tremendous’ health care for Americans, but all he’s delivered are tremendously bad coverage options for health care consumers,” Wright said in a statement.

The AHPs also concern Christine Owens, executive director of the National Employment Law Project, a non-partisan, not-for-profit group that researches and advocates on issues impacting low-wage and jobless workers.

“AHPs will cherry-pick what risks to cover and what benefits to offer, siphoning younger and healthier individuals away from state-regulated markets, and leaving millions of sicker individuals at risk of losing their health insurance,” Owens said in a statement. Further, the Labor Department rule “exempts AHPs from the ACA consumer protections that apply to small businesses and individuals.”

We turn to a business critic of AHPs, Frank Knapp Jr., president and CEO of the South Carolina Small Business Chamber of Commerce. “AHPs do not level the playing field for small businesses and big businesses,” according to him. “Big businesses with health insurance for employees cover most of the essential benefits like maternity coverage and prescription drugs.

“Small businesses should not have to drop that important coverage to get cheaper rates. AHPs essentially would create a two-class system, big businesses with good plans and small businesses with inferior plans. This does not level the playing field for small businesses when trying to recruit and retain good employees.”

Prior to the June 19 rule change by the Labor Dept., the Department. of Justice had deemed the individual mandate of the ACA unconstitutional.

Back in the Golden State, four bills to protect and strengthen the ACA from GOP attacks are under consideration in the Democratic-controlled legislature. To stabilize the ACA, for example, the California legislation would forbid AHP-like “junk” insurance, continue limits on excess insurer overhead and profits, and ban eligibility exclusions such as work requirements in Medi-Cal (California’s version of Medicaid, the federal and state program that helps some low-income people with medical costs), according to Wright of Health Access California.

“These four bills are part of the larger effort to move California towards a more equitable, sustainable, and universal health care system,” he said in a statement, giving a nod to the Care4All California coalition. More details are at www.care4allca.org.

Seth Sandronsky lives and works in Sacramento. He is a journalist and member of the Pacific Media Workers Guild. Email sethsandronsky@gmail.com.

From The Progressive Populist, August 1, 2018

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