October 27, 2017 – President Trump’s Executive Actions on Healthcare, Part I: Expanding Options for Small Businesses
This Freedom Friday post is the first part of a periodic series examining President Trump’s recent executive actions on healthcare reform and the ongoing effort to rid Americans of Obamacare.
What are association health plans and what does President Trump’s executive order do?
Association health plans (AHP) are arrangements by which related small businesses pool resources to purchase healthcare coverage through a national trade or professional organization.
On October 12, Donald Trump issued an executive order that aims to expand the availability of AHPs by encouraging federal agencies to overturn rules that currently restrict the size of these entities and prohibit them from operating across state lines. This action would also exempt AHPs from the mandatory coverage requirements (“essential health benefits”) established by Obamacare.
Why is this a good thing?
With the signing of this executive order and follow-up action on the part of relevant federal agencies, small businesses will gain many more coverage options, as well as relief from onerous Obamacare mandates. Additionally, small businesses will almost certainly reduce their healthcare costs if they decide to enter into AHPs, because they will be able to negotiate with major insurance companies as a large pool, rather than individually. And even if a small business doesn’t want to participate in an AHP, it doesn’t have to: businesses would still be able to purchase insurance on the Obamacare exchanges or the private insurance market if they so choose.
What needs to happen next?
Now that President Trump has paved the way, Congress needs to follow suit by passing legislation to codify this executive order so that it remains in effect long after the current president leaves office. The House has already gotten the ball rolling by passing the Small Business Health Fairness Act (H.R. 1101) to achieve this result. That bill is currently awaiting action in the Senate.
I also believe that not only AHPs, but all other businesses and consumers, should be able to purchase healthcare coverage across state lines. In July I offered a bill, H.R. 3278, to achieve that end. This legislation is still being reviewed in the House Energy and Commerce Committee.
What are they saying?
“In the wake of the Senate’s failure to repeal Obamacare, we are grateful to President Trump for addressing regulations that make it harder and costlier for small business owners to provide healthcare for themselves and their employees. The cost of healthcare has been the number-one problem for small businesses for more than 30 years. NFIB has fought to remove penalties on small businesses for helping their workers buy health insurance, and the President’s action early this month advances that effort.” – Juanita Duggan, National Federation of Independent Business
“The National Association of Home Builders has been a long-time proponent of association health plans and believes this market-based health care option would grant small businesses access to better and more affordable health care plans. By providing the ability to create pooling arrangements across state lines, association health plans would ensure a level playing field for smaller firms that want to help their workers and their families with their health care needs.” – Granger MacDonald, chairman of the National Association of Home Builders