The United States Department of Labor has issued a final rule overturning a Trump Administration policy allowing some small businesses to use Association Health Plans to avoid providing patient protections required by the Affordable Care Act (“ACA”).
The now overturned policy allowed certain groups of employers to form associations to offer health insurance coverage that was exempt from the ACA’s requirement to provide the Essential Health Benefits, such as mental health, maternity, prescription drugs, and emergency services. In addition, under the policy, Association Health Plans were not required to follow the ACA’s federal pricing rules. This meant that they were allowed to set higher premiums for higher risk groups, such as the elderly and those in high-risk industries.
Patient groups and many providers had opposed the Association Health Plan policy. Much of it was previously struck down by a federal court, which found that the policy was “intended and designed to end run the requirements of the ACA,” but that it did so “only by ignoring the language and purpose of both ERISA and the ACA.”
In announcing the final rule overturning the policy. Assistant Secretary for Employee Benefits Security Lisa M. Gomez stated: “[T]oday’s action is consistent with the President’s directive to improve the comprehensiveness of coverage and ensure that consumers have access to quality coverage that is consistent with federal law.”
The Department of Labor’s press release announcing the new rule is linked here. Whatley Kallas, LLP’s previous article on the federal court decision previously overturning much of the Trump Administration’s Association Health Plan policy is linked here.