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BUSINESS Friday 26 OctOber 2018
A25

Business owners can team up on insurance, if state allows it

By JOYCE M. ROSENBERG 2000 and 2002; these scams
Associated Press covered 15,000 employ-
NEW YORK (AP) — As small ers and more than 200,000
business owners shop for policyholders and left over
2019 health insurance, $250 million in unpaid medi-
some will for the first time cal claims.
have the chance to join Those scams are a key rea-
forces and buy cheaper son why Congress gave
insurance — depending on states broad powers to
which state they're in. regulate association health
New rules that began going plans, says Kevin Lucia, a
into effect last month allow professor at Georgetown
sole proprietors and other University's Health Policy
business owners without Institute. He noted that
employees to form what some states require asso-
are known as association ciation health plans to be
health plans, or AHPs. But in existence for two years
while the Trump adminis- before they can sell insur-
tration has touted the rules ance, and some AHPs are
as a breakthrough, many required to be licensed as
owners will be disappoint- insurers. California recently
ed to learn their states' in- enacted a law that pro-
surance laws will limit their hibits sole proprietors and
ability to join the plans. partners from participating
The rules issued by the La- In this Wednesday, Oct. 17, 2018 photo, Melissa Perlman, owner of BlueIvy Communications, a in the plans.
bor Department allow sole public relations and communications agency, poses for a photo in Delray Beach, Fla. ADVICE AND CAVEATS
proprietors and partners to Associated Press Owners interested in asso-
buy coverage that wasn't ciation health plans should
available to them under taking effect. The bureau and 35 percent weren't. tential association health do plenty of research, start-
the Affordable Care Act. had been working on a CONCERNS AND OBSTA- plan being considered ing with the laws of their
The rules also permit the plan for farmers, ranchers CLES by the Greater Delray states.
plans to offer insurance and agribusiness owners, While many states have Beach Chamber of Com- "It could be a nonstarter
that doesn't meet the but "the rules made it eas- welcomed the new rules, merce. Perlman is aware depending on what state
health law's requirements ier for sole proprietors to be 11 others and Washington, coverage might not be as you're in," says James
for basic coverage. involved," says Rob Robert- D.C., are suing the Trump comprehensive as on the Schutzer, a vice president
The catch for many busi- son, the bureau's chief ad- administration, charging open market. But, she says, at insurance broker JDM
nesses is the rules, unlike ministrator. the rules allow insurance "whatever is offered would Benefits in White Plains,
many other federal laws The Society of Collision to be sold that offers less be an improvement from New York. Like other bro-
and regulations, don't su- Repair Specialists, which coverage and consumer offering nothing." kers, Schutzer received a
persede state requirements represents over 6,000 ve- protections than are re- But the Labor Department reminder in July from the
for health insurance, and hicle repair shops across quired by law. Under the rules have also raised con- state Department of Finan-
states that heavily regulate the country, is developing rules, association health cerns that some new asso- cial Services that New York
insurance are expected to an association health plan plans are considered to ciation health plans might law "strictly limits the asso-
make it harder, if not impos- and hopes to be able to be large group employers, not be financially sound; if ciations or groups of em-
sible, for association health offer coverage during the and the Affordable Care they became insolvent, as ployers that may sponsor a
plans to be formed. first quarter of 2019, execu- Act doesn't require large some mismanaged plans health insurance plan."
Moreover, there are con- tive director Aaron Schul- groups to provide minimum did in the past, policyhold- Even states that don't cur-
cerns that new association enburg says. Nearly three- essential, or basic, cover- ers could be stuck with rently have laws restricting
health plans could revive quarters of the group's age. Among the benefits medical bills. association health plans
a problem from the past members have said they're the ACA requires: prescrip- There are also fears that could enact them, says
— plans that become insol- interested, Schulenburg tion, pregnancy and well- some new plans could be Karen Pollitz, a senior fellow
vent or are scams. says. ness coverage. scams, repeating some un- at the Kaiser Family Foun-
As owners research their The organization is using a That may not worry some pleasant history. In 2004, the dation. "They could pass
options for 2019 health in- benefits consultant to find owners. Melissa Perlman U.S. Government Account- rules saying you can't form
surance, here's what they the best carrier for its plan, hasn't been able to afford ability Office reported that an AHP just for the purpose
should know about AHPs: Schulenberg says. insurance for her staffers there were 144 plans that of selling insurance," some-
WHY THEY'RE APPEALING "We found examples of since starting her public weren't authorized to sell thing that the rules permit,
Association health plans average savings in some relations company, BlueIvy health insurance between Pollitz says.q
have been around for de- of the already established Communications, in 2011.
cades; they've been legal networks reaching close to She's interested in the po-
if their members were in 20 percent," he says.
the same industry or profes- Still, many owners know
sion, or in the same state. little about the plans. A sur-
But under the Affordable vey of 1,000 owners by Bank
Care Act, owners without of America found that 30
employees had to buy in- percent aren't familiar with
dividual coverage from a them. The survey, taken be-
major carrier or from state tween late August and ear-
exchanges. ly October, also found 35
The Nebraska Farm Bureau percent were interested in
announced its AHP soon offering coverage through
after the new rules began an association health plan,