Yesterday, President Trump finalized the regulations allowing #SmallBusiness to have more options for their Group Health offerings to #employees. Association Health Plans, or #AHP, are now less restrictive because of Trump legislation. AHPs allow certain employers to band together to obtain Group Health Insurance through an “association” affiliation. The employer must be in the same industry to be able to join the AHP, but the potential benefits could be much lower pricing.
Potential benefits to joining an AHP
When an employer joins an AHP and purchases Health Insurance through them, there could be a monthly savings on premium. The idea is that pooling resources and large group purchasing has more power than our traditional #EmployeeBenefits pricing structure in place now. The Group Health benefits could be tailored to fit the industry and what the AHP wants to offer to their members. Something else that you don’t hear much about it that the rating structure can be different than what is currently available now. When a larger group obtains #GroupHealth from insurance carriers, employee pricing is not based on age. A single employee price is X, employee plus spouse is Y….etc. Currently groups under 100 employees pricing is age rated, meaning someone 20 is fairly cheap (nothing is cheap anymore) and someone 60 is stupid expensive. If you have an older group of employees, this may be a viable solution for cost savings….younger groups, maybe not.
Drawbacks to AHPs and the coverage options
With AHPs, because of the way they’re structured, they can offer #EmployeeBenefit plans that do not include the #ACA mandated essential coverage services like maternity, pediatric dental, even hospitalization. Some see this as a good thing. Why would someone 55 years old want to pay for maternity coverage or pediatric dental at their age. I get more angry calls from people that are seeing double digit increases, complaining about having to “subsidize” others for coverage they don’t need or want. They have a point. If someone has kids, let THEM pay for the increase