On June 19, 2018, the U.S. Depart­ment of Labor (DOL) pub­lished Fre­quent­ly Asked Ques­tions About Asso­ci­a­tion Health Plans (AHPs) and issued a final rule that broad­ens the def­i­n­i­tion of “employ­er” and the pro­vi­sions under which an employ­er group or asso­ci­a­tion may be treat­ed as an “employ­er” spon­sor of a sin­gle mul­ti­ple-employ­er employ­ee wel­fare ben­e­fit plan and group health plan under Title I of the Employ­ee Retire­ment Income Secu­ri­ty Act (ERISA).

The final rule is intend­ed to facil­i­tate adop­tion and admin­is­tra­tion of AHPs and expand health cov­er­age access to employ­ees of small employ­ers and cer­tain self-employed indi­vid­u­als. Gen­er­al­ly, it does this in four main ways:

  • It relax­es the require­ment that group or asso­ci­a­tion mem­bers share a com­mon inter­est, as long as they oper­ate in a com­mon geo­graph­ic area;
  • It con­firms that groups or asso­ci­a­tions whose mem­bers oper­ate in the same trade, indus­try, line of busi­ness, or pro­fes­sion can spon­sor AHPs, regard­less of geo­graph­ic distribution;
  • It clar­i­fies the exist­ing require­ment that groups or asso­ci­a­tions spon­sor­ing AHPs must have at least one sub­stan­tial busi­ness pur­pose unre­lat­ed to pro­vid­ing health cov­er­age or oth­er employ­ee ben­e­fits; and
  • It per­mits AHPs that meet the final rule’s new require­ments to enroll work­ing own­ers who do not have employees.

The final rule will be effec­tive on August 20, 2018.

The final rule will apply to ful­ly-insured AHPs on Sep­tem­ber 1, 2018, to exist­ing self-insured AHPs on Jan­u­ary 1, 2019, and to new self-insured AHPs formed under this final rule on April 1, 2019.

The DOL is using a stag­gered approach to imple­ment this final rule so states and state insur­ance reg­u­la­tors will have time to tai­lor their reg­u­la­tions to the final rule and address a range of over­sight and com­pli­ance assis­tance issues, espe­cial­ly con­cerns about self-insured AHPs’ vul­ner­a­bil­i­ty to finan­cial mis­man­age­ment and abuse.

For more infor­ma­tion about the DOL’s final rule, request UBA’s ACA Advi­sor “DOL Issues Final Reg­u­la­tions Regard­ing Asso­ci­a­tion Health Plans.”


By Karen Hsa

Orig­i­nal­ly post­ed by www.UBABenefits.com