What is a Health Association Plan?
An association health plan is the idea that a small business or self-employed individual can band together with other like-minded businesses to offer insurance as a large group plan. Some common examples would be plumbers or electricians, but could also be any professional or interest groups like the United Automobile Workers Union. The small businesses within the association can negotiate with insurers with more clout as a large group than each separately, bargaining for lower rates.
Since association health plans are large group plans they are only under federal regulation, which is more loosely regulated than you think. As a large group plan, association health plans would not have to abide by most regulations of the ACA. There are a few notable exclusions. One is the requirement under the ACA to offer 10 essential health benefits i.e. emergency care, prescriptions, mental health, and so on. The other exclusion is that association health plans are not required to provide the same premium whether an individual is in good health or not.
At the moment, health association plans is an idea and not current practice until law allows.
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