Michael Fisher: Association health plans unbalance state’s insurance markets

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Editor’s note: This commentary is by Michael Fisher, who is the head of the Vermont Office of the Health Care Advocate.

President Trump continues to do his best to undercut the Affordable Care Act and disrupt health insurance marketplaces across the country. Last year, Vermont missed the boat on stopping one of these new policies and allowed disruptive association health plans to be sold for 2019. In response to legal challenges from 12 attorneys general, a federal district court judge recently vacated the Trump administration’s rule that had allowed these plans. The decision, written by a judge appointed by George W. Bush, concludes that Trump’s rule change is unlawful as it unreasonably interprets ERISA and “was intended and designed to end-run the requirements of the ACA.”

Due to this ruling, over 5,000 Vermonters are now in health insurance plans that violate the ACA and have ambiguous legal standing. If Trump’s policy is allowed to continue in Vermont, association health plans will cause cost increases and instability in Vermont’s individual and small group health insurance marketplace and hurt Vermonters who already struggle to afford their health insurance and health care.

Vermont policymakers are currently debating H.524, an important bill that will shore up state law to provide protections to Vermonters against recent and future changes at the federal level. H.524 updates state law to protect against preexisting condition exclusions and lifetime limits, to maintain the right to keep children on their parent’s plan through age 26, and to ban separately rated association health plans. Many other states including New Hampshire, Massachusetts and New York agree that association health plans are a serious threat to already tenuous health insurance markets and have passed similar legislation.

There has been significant pushback on the association health plan rating rule by the Vermont Chamber of Commerce, insurance brokers, Blue Cross Blue Shield of Vermont, and many small businesses who argue that these plans will reduce their costs. They ignore that these plans are part of Trump’s plan to dismantle the ACA and that their savings will result in higher costs for everyone left behind in the risk pool.

The Vermont House passed H.524 to protect Vermonters from further erosion of our already small and expensive individual and small group insurance market by the Trump administration. H.524 is now being considered by the Vermont Senate. We must not let them cave to pressure from the associations, brokers, insurance companies and businesses who benefit financially from Trump’s attempts to skirt federal law and undermine consumer protections. We urge the Senate to put the interests of Vermonters and the stability of our risk pool ahead of the financial interests of these business entities by passing H.524.

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