California Winces At Trump's Turn Back To 'Bad Old Days' Of Health Plan Associations

Kaiser Health News, December 4, 2017

State lawmakers passed sweeping changes in the 1990s that consigned association health plans to near extinction. The Trump administration aims now to revive them.

This article first appeared December 04, 2017 on Kaiser Health News.

By Pauline Bartolone

Workers prepare Eric Clapton vinyl album jackets for shipping at Stoughton Printing in 2014. Stoughton offers health insurance through a plan in which small businesses jointly purchase coverage. (Jay L. Clendenin/Los Angeles Times)

Just a few decades ago, small businesses in California often banded together to buy health insurance on the premise that a bigger pool of enrollees would get them a better deal.

California’s dairy farmers did it; so did car dealers and accountants.

But after a string of these “association health plans” went belly up, sometimes in the wake of fraud, state lawmakers passed sweeping changes in the 1990s that consigned them to near extinction.

Now, President Donald Trump wants to promote a renaissance of these health plans and make it easier for them to operate across state lines — with less regulation. In a recent executive order, Trump directed the Department of Labor to look into ways to “allow more small businesses to avoid many of the [Affordable Care Act’s] costly requirements.”

Because the plans would do business in more than one state, they could “figure out a way to pull back some authority states have,” said Kevin Lucia, senior research professor at Georgetown University’s Center on Health Insurance Reforms.

Kaiser Health News

Kaiser Health News is a national health policy news service that is part of the nonpartisan Henry J. Kaiser Family Foundation.


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