October 13, 2017 from My Benefits Advisor: President Trump signed an Executive Order (“EO”) on October 12,2017, directing various federal agencies to take regulatory action that will “increase health care choices for millions of Americans.” Along with the EO, the Administration issued a press release and some internal talking points that provide helpful insight into what the agencies are directed to review.
As it affects employer-sponsored plans:
• The Department of Labor (“DOL”) is directed to consider expanding access to Association Health Plans (“AHPs”) which could allow employers to form groups across state lines. Specifically, by taking a broader interpretation of ERISA, employers in the same line of business anywhere in the country could join together to offer healthcare coverage to their employees through the large group insurance market or through selfinsurance, potentially accessing more coverage options at a lower cost. Such arrangements could be formed for the “express purpose” of offering group insurance (under current regulations, the sole purpose of any association plan cannot be the purchase of group insurance).
• Within 60 days, the DOL shall consider proposing regulations or revising guidance consistent with the law, to expand access to health coverage by allowing more employers to form AHPs. The EO directs the agency to consider expanding the conditions that satisfy the “commonality-of-interest” requirements under the existing definition of an “employer” under ERISA 3(5). • The EO continues to support popular ACA mandates, including offering coverage to children to age 26, no annual or lifetime dollar limits, no costsharing for certain preventive care, and a general prohibition on preexisting condition exclusions and health status rating. • The EO specifically references using self-insurance as an option of AHPs. Because the current federal law permits association coverage to be governed under both state and federal rules, the EO raises issues in those states that either (1) prohibit creation of new self-insured association plans or (2) heavily regulate the ability to use self-insurance as an option under multiple employer welfare arrangement (“MEWA”) rules.
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