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Rules finalized to expand association health plans

The Trump administration has rolled out a final rule on association health plans — a rule supporters say will allow more small businesses to access affordable health insurance.

The rule comes months after President Trump and the Department of Labor proposed changes that allow consumers, employer groups, and contractors to sponsor AHPs.

AHPs are not required to provide the essential health benefits (EHBs) package included in the Affordable Care Act.

The idea behind AHPs is to allow small businesses to band together as associations — organized either by geographic region or business type — to purchase health insurance for their employees.

“By providing scale and access to a large-group market, [small businesses will get] coverage at a better price,” Labor Secretary Alex Acosta said. “This includes 400,000 Americans who are currently uninsured. [The] AHP [rule] will include safeguards, consumer protections and anti-discrimination protections” similar to those applied to large businesses.

AHPs, in fact, have been in existence for some time, but the new rules substantially expand the circumstances under which they can be created. The regulations eliminate a requirement that any association must already have existed for a purpose unrelated to health insurance. And for the first time, individuals will be able to buy one of the plans.

The final rule will take effect in phases, with an effective date of Sept. 1, 2018, for all associations to establish a fully-insured AHP; Jan. 1, 2019 for existing associations that have already established an AHP and want to start up a self-funded plan; and April 1, 2019 for all other associations to establish a self-funded plan.

About the Author

Larry Hannappel

Larry spent 16 years with Century Casino’s and was instrumental in the start-up and growth of the company through expansions in Canada, South Africa, the Czech Republic, Poland and on several cruise ships as well as in Colorado. He was most recently the SVP, Principal Finance Officer and COO of North American operations for Century Casinos Inc., a multinational, Nasdaq-traded gaming company. Earlier in his career, Larry worked at the Johns Manville Corp. Larry spent 13 years in various accounting and finance functions in the company’s fiberglass manufacturing division and was key in the start-up of a molding plant in Indiana. Larry and his wife Kathy and three children live in Colorado. He enjoys four-wheeling, motorcycling, golfing, skiing and brewing beer.