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August 30, 2018

June marked the implementation of a regulation focusing on Association Health Plans (AHPs) and the benefits they may offer small businesses and self-employed individuals within the same industry or profession. Click here for a breakdown of this final ruling by our legal team at Steptoe & Johnson.

The Council Perspective: AHP expansion rests on the idea that these groups will come together to buy more affordable health insurance as an alternative to the ACA. However, AHPs have historically been riddled with scandal, resulting in the creation of state-specific regulations aimed at avoiding insolvency, higher premiums and fewer plan choices.

Notably, the U.S. Department of Labor regulation does not alter any state authority to regulate multiemployer welfare arrangements (MEWAs), of which AHPs are one type. Consequently, whether AHPs gain any traction will likely be up to the states and how they choose to regulate the plans (12 states have already filed lawsuits aimed at striking down the new regulation). In addition, professional and trade associations, small businesses and other groups will have to wait to determine if insurance carriers choose to offer AHP plans at all. Thus, brokers looking to offer AHPs are operationalizing strategies in an uncertain environment.