Association Health Plans, AHPs, as predicted may soon be reality. But, opposition will be intense and insane. Let’s look closer.

As he promised, the President signed an EO directing the Departments of HHS, of Labor, and Treasury to review and implement guidelines allowing for AHPs and for the selling of these AHPs cross state lines.

Be for-warned that the opponents of AHPs, selling cross state lines or any change to the ACA will scream bloody-murder & disaster. They will “cry” that babies will die in their mother’s womb(don’t say it, too easy), that children will go without vaccinations, that women won’t get their lady healthcare, that severe disease won’t be treated and that our streets will be filled with the bodies of citizens denied care. Think that’s too strong? Just watch!

Why would any employer or citizen purchase a health plan that did not fit their needs unless they were forced to, as they are by the ACA. So, let’s take an honest look at AHPs and project what could happen, if the GOP gives us a chance.

AHPs are not a new concept and there are countless examples of where and how they have been successful. In California, for example, there are dozens of examples of successful AHPs, from the pre-ACA era, that provided alternatives for CPAs, Attorneys, Auto Dealers, Chambers of Commerce, Builders Associations, Growers Associations, Engineers, Architects, Plumbers, Contractors, Farmers, even Insurance Agents and you can go on for ever.

Why the confusion or fear? Setting aside the obvious political and ideological opposition let’s look at this logically. There are examples of successful AHPs that are both Fully Insured and Self-funded. But, there are also examples of AHPs that failed which were both Fully Insured and Self-funded.

Why were some successful and some not? The answer, as success always is, is complicated but reasons include burdensome regulations and over-reach by regulators, hundreds of miscellaneous state mandates, poor management or sometimes mismanagement, managed care, PPOs, competition and changing times. But, the fact remains that history shows us how AHPs can work and don’t we all agree that small employers need alternatives to what’s been forced upon them the past 7 years.

Let’s look at some specifics both bad and good. The bad first because it’s possible that:

  • Some AHPs will be created and sold that fail.
  • Some AHPs created may offer less benefit than ACA EHB’s require.
  • Some purchasers may not understand the AHP presented to them.
  • Some Brokers may not understand the AHP they’re presenting.
  • Well designed and managed AHPs could take healthy customers from existing plans.

Now the good, because AHPs:

  • May be created with EHBs but still lower premium cost.
  • May include richer benefits than the ACA plans with EHBs.
  • May result in lower out of pocket for members.
  • Will provide alternatives and more choice.
  • Will be well-managed and properly presented.
  • Not every one requires Pediatric dental or other mandated benefits.
  • Small employers will get choices similar to large employers.
  • Restrictive “state specific” limitations can be over-come.
  • Employers will get better transparency in their plans.
  • May increase enrollments.
  • Brokers will be enabled to do their job!

The last bullet is important because I believe that insurance brokers are better suited to counsel employers than state bureaucrats or ACA enrollers. Brokers, given the chance and products, will help employers select the plan(s) that best suit an employer’s goals of providing a health plan to its employees.

If the Depts. of Labor, HHS, and Treasury do their job well, AHPs will allow employers:

  • Access to Fully Insured and Stop-Loss plans that currently can not be offered due to the ACA’s or local state restrictions.
  • Buy with discounts like other large purchasers can. (Do you think Wal-Mart pays the same price for the goods it sells as your local independent small store?)
  • More competitive pricing from the current plans available.
  • Make plans available to employers where none are available now.

There are many details for us to see worked out by the various departments noted above. Those details and the process to create them will be viciously assaulted by opponents of AHPs and any change to the ACA.

Already, we’ve read statements by one leading Dem Congresswomen Americans will have their pre-existing conditions denied even though there is no evidence to support that claim. Plus, why would a broker present or an employer purchase a plan that hurts the very employees the employer needs for success.

AHPs could lead to some exciting opportunities to improve healthcare in our country. Plans created by innovative TPAs will offer solid benefit packages with lower premiums that include cost controls, transparency, and stability for the next 3-5 years.
Jeez, wouldn’t a little stability be nice.

That’s it for now but we’ll watch this development as it evolves. Let us know what you think. We want to hear concerns as well as platitudes for these AHPs.

Never a better time cause we’re in this together.
Until next week.

Mark Reynolds, RHU
559-250-2000
mark@reynolds.wtf

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