TAKE CARE: Advocacy Blog Series - Association Health Plans
We are continuing our advocacy blog series meant to help you take care when it comes to important arthritis health care and coverage issues. If you’re just now tuning into this series, check out our previous advocacy blog posts here. In August, we kicked off a focus on health insurance benefits as we approach open enrollment this fall. This week, we take a closer look at association health plans.
As the term indicates, association health plans (AHPs) are a specific type of health plan that an employer group or an association can offer to their employees. A key feature of an AHP is that small employers can band together to purchase health care for their employees. By pooling resources, these groups are theoretically able to purchase health coverage that rivals significantly larger employers and keeps premiums lower for employees.
Like short-term health plans, AHPs are not new; they’ve been around since the 1970s. AHPs received renewed attention this year due to a regulation issued by the administration over the summer that expanded their availability. Over 90 percent of health care stakeholders strongly opposed this action, but the administration decided to move forward with its proposal.
Beginning in September, small employers now have increased flexibility to form an association if they are in the same geographic area. This was not true before: Under the old rules, only small businesses in the same industry could form associations and purchase health coverage (for example, a bakery and a deli). The new rules are broader: A local bakery and a hardware store in the same region, for instance, can now theoretically form an association to obtain coverage for their employees. The new regulation also includes sole proprietors, or those individuals who exclusively own and operate a business and report income and losses on their personal income tax return.
Although the final regulation prohibits an AHP from discrimination across eligibility, premiums or benefits based on any one health factor, they can vary premiums based on age, industry, gender, occupation or related demographic factors. In addition, these plans do not need to cover all the Affordable Care Act’s essential health benefits, such as prescription drug coverage or hospital care. For these reasons, AHPs are likely not ideal for people with arthritis or other chronic diseases.
Like short-term health plans, AHPs have a history of fraud. These plans have also been financially unstable in the past. The expansion of AHPs could also contribute to health insurance market instability as healthy patients leave the individual market due to the promise of lower premiums in these plans. While lower premiums might sound attractive, AHPs are not required to cover essential health benefits like prescription drugs. This means a patient with arthritis may not be able to appropriately manage his or her disease if enrolled in an AHP. Unexpected illness is another important consideration due to the limited scope of benefits offered through an AHP.
The Arthritis Foundation has already kicked off the open enrollment season to raise awareness of your health care choices for 2019. Revisit our Take Care blog posts or get started with our Your Coverage, Your Care toolkit. The toolkit is a great resource to help you understand your insurance options, the claims process and tips to overcome barriers. We're here to provide support when you need it most. Our trained staff — including a Spanish-speaking expert — understand arthritis and are available by phone or web chat 9 a.m. to 5 p.m. ET, Monday to Friday. Available times on holidays may vary. The Helpline is here for you: 800-283-7800.
If you’d like to stay informed of federal and state-based health care issues, consider signing up to be an Advocate. Becoming a part of our advocacy grassroots network is an easy way to get involved and stay updated.
What are association health plans?
As the term indicates, association health plans (AHPs) are a specific type of health plan that an employer group or an association can offer to their employees. A key feature of an AHP is that small employers can band together to purchase health care for their employees. By pooling resources, these groups are theoretically able to purchase health coverage that rivals significantly larger employers and keeps premiums lower for employees.
Why are association health plans in the news?
Like short-term health plans, AHPs are not new; they’ve been around since the 1970s. AHPs received renewed attention this year due to a regulation issued by the administration over the summer that expanded their availability. Over 90 percent of health care stakeholders strongly opposed this action, but the administration decided to move forward with its proposal.
What is changing with association health plans?
Beginning in September, small employers now have increased flexibility to form an association if they are in the same geographic area. This was not true before: Under the old rules, only small businesses in the same industry could form associations and purchase health coverage (for example, a bakery and a deli). The new rules are broader: A local bakery and a hardware store in the same region, for instance, can now theoretically form an association to obtain coverage for their employees. The new regulation also includes sole proprietors, or those individuals who exclusively own and operate a business and report income and losses on their personal income tax return.
What kind of issues would someone with arthritis face if they enrolled in an association health plan?
Although the final regulation prohibits an AHP from discrimination across eligibility, premiums or benefits based on any one health factor, they can vary premiums based on age, industry, gender, occupation or related demographic factors. In addition, these plans do not need to cover all the Affordable Care Act’s essential health benefits, such as prescription drug coverage or hospital care. For these reasons, AHPs are likely not ideal for people with arthritis or other chronic diseases.
Is there anything else I should be aware of about association health plans during open enrollment?
Like short-term health plans, AHPs have a history of fraud. These plans have also been financially unstable in the past. The expansion of AHPs could also contribute to health insurance market instability as healthy patients leave the individual market due to the promise of lower premiums in these plans. While lower premiums might sound attractive, AHPs are not required to cover essential health benefits like prescription drugs. This means a patient with arthritis may not be able to appropriately manage his or her disease if enrolled in an AHP. Unexpected illness is another important consideration due to the limited scope of benefits offered through an AHP.
What resources are available from the Arthritis Foundation?
The Arthritis Foundation has already kicked off the open enrollment season to raise awareness of your health care choices for 2019. Revisit our Take Care blog posts or get started with our Your Coverage, Your Care toolkit. The toolkit is a great resource to help you understand your insurance options, the claims process and tips to overcome barriers. We're here to provide support when you need it most. Our trained staff — including a Spanish-speaking expert — understand arthritis and are available by phone or web chat 9 a.m. to 5 p.m. ET, Monday to Friday. Available times on holidays may vary. The Helpline is here for you: 800-283-7800.
If you’d like to stay informed of federal and state-based health care issues, consider signing up to be an Advocate. Becoming a part of our advocacy grassroots network is an easy way to get involved and stay updated.