Health providers, insurers and medical groups have warned that the plans could drive up premiums and make insurance unaffordable for some people by siphoning off healthy consumers who want cheaper coverage, leaving behind a sicker patient pool with higher medical costs in Obamacare plans.
The rule expands the use of association health plans, in which small businesses, including self-employed workers, can join forces by geography or industry to get health care coverage as if they were a large employer.
Like the version proposed in January, the final rule allows employers with a "commonality of interest" to offer joint coverage without numerous restrictions that previously applied to coverage provided through associations.
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".
"Association Health Plans will create a new pathway for small businesses and self-employed individuals to come together and produce these plans, with the goal of providing relief to soaring premiums and deductibles", the representatives. They can also offer skimpier benefits so policyholders may have to pay more out of pocket if they actually need care.
Underwood and Massachusetts Attorney General Maura Healey said the new rule, which could lead to millions shirking the Obamacare market and purchasing association health plans (AHPs) instead, exceeds the administration's authority and will "invite fraud, mismanagement, and deception".
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"They can negotiate healthcare in a way that individual small businesses simply cannot", he said. 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.
This reform allows small employers - many of whom are facing much higher premiums and fewer coverage options as a result of Obamacare - a greater ability to join together and gain numerous regulatory advantages enjoyed by large employers.
The new rule does not affect previously existing AHPs, which were allowed under prior guidance. "This change is a big win for small businesses and employees alike". 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. "This [rule] messes up that arrangement, and it lets people go someplace else while they think they can afford lesser coverage". AHPs with employer members in multiple states may be subject to multiple competing sets of state-level MEWA compliance obligations. The preamble to the final rule makes clear that the rule does not change existing ERISA preemption rules with regard to state regulation of AHPs, through either regulation of insurance carriers and policies or direct regulation in the case of self-insured AHPs. They are the most recent piece in the administration's jigsaw efforts to undercut elements of the ACA through its own powers after the Republican-led Congress failed past year to repeal a broad swath of the sprawling 2010 statute.
DOL deleted a provision from the proposed rule that would have disqualified individuals eligible for group health coverage from another employer or a spouse's employer. (D-NJ) in a joint statement released Tuesday. That would free them from having to adhere to some of Obamacare's rules, particularly the one requiring insurers to offer comprehensive coverage.