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PA Insurance Commissioner Issues Letter to HHS on State’s Plan to Implement Association Health Plans Rule

August 02, 2018

Today, Pennsylvania Insurance Commissioner Jessica Altman sent a letter to the U.S. departments of Labor and Health and Human Services outlining the state Insurance Department’s position on the implementation of a federal rule aiming to expand association health plans (AHP).

In the letter, Altman outlined the department’s standards for AHPs, which include:

  • An association must have been active for at least two years to offer a plan
  • Businesses with just one employee won't be eligible for AHPs and must buy coverage on the individual market
  • AHPs organized in other jurisdictions will have to adhere to Pennsylvania's regulations

She noted that, “this letter creates clarity by articulating the Insurance Department’s longstanding regulatory approach for association health plans.”

The AHP policy, will expand the ability for employers to join together in an employer group or association to offer employer-sponsored health care coverage. AHP plans would be offered outside of the Affordable Care Act (ACA) markets and may provide less expensive coverage options that may not necessarily offer the full patient protections and benefits assured under the ACA. 

The provisions of the AHP rule will go into effect on a rolling basis between September 1, 2018, and April 1, 2019. Timing will depend on whether the AHP is existing or new, and whether the plan will be self-funded or fully insured.

The Commonwealth of Pennsylvania submitted comments during March in response to the proposed rule. In the comment letter, Insurance Commissioner Jessica Altman expressed concern that AHPs would not have to meet coverage requirements under the ACA for minimum essential health benefits and prescription drugs. The Commissioner cautioned that the policy could destabilize the market. In today’s letter, Altman said, “I remain concerned that this rule will allow for substandard coverage that will limit consumers’ access to comprehensive health care, and I am committed to ensuring that our laws will continue to provide necessary protections to consumers.”

HAP and Pennsylvania hospitals embrace the importance of expanding access to meaningful coverage. The ACA has been instrumental in:

  • Supporting more than 1.1 million Pennsylvanians through health insurance coverage
  • Providing better access to health care services
  • Dramatically reducing the uninsured population in Pennsylvania

HAP will continue to advocate for policy that advances those outcomes and will work with the state to ensure Pennsylvania consumers are protected.

If you have any questions relating to this issue, and the impact of coverage, please contact Jeff Bechtel, HAP’s senior vice president, health economics and policy. Questions about HAP’s federal advocacy efforts should be directed to Laura Stevens Kent, HAP’s vice president, federal advocacy.

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