118 Patient Groups Object to Proposed Association Health Plan Rule
Today, the I Am Essential coalition submitted comments, supported by 118 patient groups, to the U.S. Department of Labor expressing strong concerns with a proposed rule that would expand the scope and applicability of association health plans (AHPs). The rule was proposed in response to President Trump’s October 2017 executive order directing agencies to change existing regulations to provide consumers with more options for health care coverage.
Since AHPs do not have to abide by the Affordable Care Act’s (ACA) consumer protections and insurance market rules, the patient groups wrote that the proposed rule would “negatively impact access to quality, affordable care for consumers, disrupt the individual and small group markets, and further strain the limited resources of state regulators.”
For example, AHPs are not required to cover the ten essential health benefit categories required by the ACA, including prescription medications. It would also allow plans not to cover certain classes of drugs, such as those that treat mental illness, HIV, hepatitis, or cancer. Beneficiaries will be surprised that if a certain drug or service is not covered they will be on the hook to cover those costs. In the letter, the patient groups emphasize “individuals must have access to the full array of Essential Health Benefits for health insurance to be meaningful and so they can be assured that what they need, or might need in the future, will be covered.”
On top of that, in the letter the patient groups explain, “AHPs would not be subject to the caps on consumers’ out-of-pocket maximums for deductibles, copays, and co-insurance. This would perpetuate the trend of healthcare costs outpacing income increases for the average family.”
I Am Essential fears that the expansion of the AHP definition through the proposed rule will lead to market destabilization. “The intent of the President’s executive order was to increase consumer choice while curbing costs, however, as proposed, AHPs would invariably weaken the individual and small group markets leading to higher healthcare costs for all; higher premiums for those who stay in the marketplace, and high out-of-pocket costs for those who are covered by AHPs for unexpected medical needs.”
Finally, clear enforcement authority over AHPs is lacking, particularly if they are able to operate across state lines, and in the past these plans have been easy vehicles for fraud. For these reasons, I Am Essential is concerned that history will repeat itself, “if plans are able to operate in multiple states, it is unclear how state law would be enforced and which state’s law would take precedence. This is why insurance commissioners have long opposed the idea of selling insurance products irrespective of borders, or across state lines.”
The I Am Essential letter concludes, “The intent of the President’s executive order was to increase consumer choice while curbing costs, however we believe that AHPs as proposed would invariably weaken the individual and small group markets leading to higher healthcare costs for all; higher premiums for those who stay in the marketplace, and high out-of-pocket costs for those who are covered by AHPs for unexpected medical needs.”
Signatories to the letter include The AIDS Institute, Arthritis Foundation, Cancer Support Community, Epilepsy Foundation, Lupus Foundation of America, Mental Health America, National Multiple Sclerosis Society, National Alliance on Mental Illness, National Patient Advocate Foundation, National Psoriasis Foundation and Susan G Komen.
The full text of the comment letter and list of 118 signers can be viewed here.