Trump administration changes rules for association health plans

The U.S. Department of Labor has announced reforms to association health plans that effectively loosened regulations around such plans, granting small employers a greater ability to band together to purchase insurance (Source: “Trump opens insurance options for small business,” Crain’s Cleveland Business, July 22, 2018).

The new federal rule, which follows an October 2017 executive order issued by President Trump, aims to grant small employers many of the regulatory advantages enjoyed by larger employers and to help small businesses access affordable health coverage. 

But some worry that this could introduce substandard, cheap plans, as well as have a negative effect on the ACA exchanges.

Previously association health plans required its members to share a specific common purpose, such as an economic purpose, but the new rules allow members to be connected by simply geography or professional interests. Businesses can now join together across state lines. And the Trump administration's regulation also allows individuals who work for themselves to join plans.