How AHP Rule-changes in 2018 Could Affect You

Association health plans (AHPs) have been with us for quite some time, but the rules and qualifications by which they are formed and run are undergoing major changes in 2018 and beyond.

​Certain self employed individuals and those working in small companies and a few other situations, may be able to take advantage of an AHP policy to save on health insurance in the year and years ahead.

Essentially, AHPs allow people to "band together" to get lower insurance rates. And soon, this ability may be enhanced by the lessening of cross-state restrictions on health insurance based on Executive Order 13813 issued on 12 October, 2017.

The New DOL Rule On AHPs
On 19 June, 2018, the Department of Labor released its new set of rules on Association Health Plans, in pursuance of the 2017 executive order that sought to expand access to more affordable health insurance for small employer groups and for the self-employed.

The new order doesn't touch the status of AHPs as "multiple-employer welfare arrangements" (MEWAs), and thus, does not eliminate the hodge-podge of state-specific AHP regulations in favor of uniform national standards.  And while a class exemption for the self-employed against MEWA non-solvency laws was not yet introduced, the DOL gave indication that may be coming for AHPs down the road.

But, what the new regulations did accomplish is the creation of a new category of AHPs, those that no longer have to be composed of just employers in the same industry/profession, but also the same geographic area.  Groups can meet either of these requirements in order to form an association and establish an AHP.

Also, you can currently only establish an employer association if your organization has a business reason for existing apart from the provision of health coverage, such as educational, publishing, advertising, or standards-setting business models.  But the new ruling adds geographic area to the requirements for establishing an AHP.

The new regulations will take effect in a staggered manner, beginning on 20 August, 2018 and being fully in effect for all on 1 April, 2019.

Is An AHP The Right Health Insurance Option For Me?
It can be difficult to navigate the health insurance market today, and it helps therefore to talk to an experienced health insurance consultant before making a final decision.
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If you work for a large company, you may get your insurance through your employer as an employee benefit. If you're simply an individual seeking health coverage apart from any employment considerations, a marketplace plan might be a better fit than an AHP.  But for those who are self-employed or who work for employers too small to be subject to many ACA regulations, AHPs could be a viable option.

For expert advice on how AHPs now work and if an AHP might be right for you, contact Summerlin Benefits Consulting today!