Association Plans Taking Shape

In January, the Employee Benefits Security Administration (EBSA) posted draft regulations that could allow trade groups to offer nationwide association health plans (AHP) for member employers. The regulations are in response to President Trump’s executive order intended to facilitate access to short-term health insurance plans and the use of HRAs by employers.

The regulations will allow a general business group to offer an AHP to all members, regardless of industry, as long as the employers are located in the group’s metropolitan area. In contrast to existing association-sponsored plans, business groups that want to sponsor an AHP can organize for the specific purpose of obtaining healthcare coverage and nothing more. The regulations would enable some general purpose AHPs, such as one offered by a chamber of commerce or other business group that has members in a bordering state, to offer coverage across state lines.

As of our publication date, comments are still being received by EBSA and officials are still working on more regulations. While the initial proposal would not alter existing statutory provisions governing multiple employer welfare arrangements (MEWAs), recent updates tell us that future proposals could involve DOL authority to exempt self-insured MEWA plans from state regulation.

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