Good News For Association Health Plans

Association Health Plans are one step closer to reality following the passing of the Small Business Health Fairness Act of 2004 (HR 4281) by the House of Representatives. If passed by the senate the legislation would allow small businesses to band together and purchase self-insurance and insurance plans free of state regulation. The ability of such plans to design their own healthcare packages would make health insurance more affordable and therefore available to employees of small businesses. However passage is by no means guaranteed as some opponents are arguing that AHP's will take out the better quality risks making it more difficult for the others to buy insurance. Others are concerned that the lack of local state controls will make it difficult to impose solvency mandates to ensure that the Plans are able to pay claims when they arise and that policyholders will not have the consumer protection of local state departments that they would have if they were buying state regulated insurance.