Final Association Health Plan Rule Will Boost Small Businesses

NAHB commended the Trump administration for issuing its final rule today on association health plans (AHPs) that will help small businesses – including home building firms and local HBAs – rein in skyrocketing health care costs and provide better health coverage for workers.

NAHB has been a long-time proponent of AHPs, which empower small businesses to pool together to purchase health insurance plans for their employees.

In his comments on the new rule, which implements the executive order on AHPs signed by President Trump last fall, NAHB Chairman Randy Noel said: “It will grant small businesses access to better and more affordable health care plans, place these firms on an equal footing with large employers and unions when it comes to negotiating lower costs for coverage, and level the playing field for smaller companies that want to help their workers and their families with their health care needs.”

Of particular importance to the home building industry, the rule will allow sole proprietorships and independent contractors to participate in the program, expanding access to affordable health coverage to small employers and self-employed individuals.

The final rule expands the ability of small businesses to join together locally or across state lines through a bona fide industry, professional, or trade association to become large purchasers of health insurance. This ability to establish AHPs across state lines will provide additional flexibility if HBAs seek to set up such a program and could help participating member businesses attract and retain talented workers by offering competitive benefits.

The new rule also grandfathers existing regulations, so that HBAs that are already running successful AHPs can continue to offer affordable health coverage to their employees under their current system or choose to operate their program under the new definitions of the final rule.

The Congressional Budget Office estimates the final rule will allow 4 million Americans, including 400,000 who otherwise would lack insurance, to join an AHP by 2023.

To minimize disruption to the health care market, there will be a staggered rollout of the new rule as follows:

  • All associations (new or existing) may establish a full-insured AHP on Sept. 1, 2018.
  • Existing associations that sponsored an AHP on or before the date the final rule was published may establish a self-funded AHP on Jan 1, 2019.
  • All other associations (new or existing) may establish a self-funded AHP on April 1, 2019.

View a one-page fact sheet.

For more information, contact Alexis Moch at 800-368-5242 x8407, or Tom Ward  at x8230.

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Comments (6)

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  1. Jeff Dworkin says:

    Great!! So when is NAHB gonna be rolling out a plan to members??

    • NAHB Now says:

      Jeff, that is a question that other members and state associations are asking as well. In anticipation of that, an NAHB member task force has been engaged in the rulemaking process from the very start with the goal of determining what our next steps can and should be. The task force will have an update for our senior officers soon.

      • Jeff Dworkin says:

        I know that all are asking because this is one of the TOP issues affecting us small Builders and Associates! Hopefully we (NAHB) are one of the First to bring an AHP to its Membership!

      • J Don says:

        An NAHB AHP would be the best and most cost effective membership recruitment tool that NAHB could ever offer.

        • Jeff Dworkin says:

          J Don you are ABSOLUTELY CORRECT!! As we have been discussing down here in Texas, this is a “game changer” on the Membership front. I know Granger McDonald was really pushing to ensure NAHB had things in motion on that front! I certainly hope that the “soon” they are referring to is within weeks, NOT MONTHS!

  2. That is GREAT news! Both my husband and I are sole proprietors so the second largest bill we pay each month is health insurance for our family. It is only slightly less than our mortgage. I sure hope this brings some much needed cost relief.

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