A Step Forward for Association Health Plans

Filed in Labor, Legal by on October 12, 2017 14 Comments

President Trump shakes hands with NAHB First Vice Chair Randy Noel after signing the executive order.

President Trump today signed an executive order that would ease restrictions on association health plans and health reimbursement accounts to create more options for small businesses to provide health benefits to their employees.

NAHB has long led the fight in support of association health plans, which would grant small businesses access to better and more affordable health care plans, allow them to negotiate lower costs for coverage, and level the playing field for smaller firms that want to help their workers and their families with their health care needs.

Attending the White House signing ceremony, NAHB First Vice Chairman Randy Noel said the president’s executive order “would empower home building firms such as my own and countless other small businesses to pool together through association health plans to purchase health insurance. This would put small businesses on an equal footing with large employers and unions when it comes to negotiating lower insurance rates.”

Moreover, the executive order would expand the use of health reimbursement arrangements, which allow small businesses to offer pre-tax dollars to insured employees to help pay premiums and/or other out-of-pocket costs associated with medical care and services.

The IRS issued guidance in 2013 prohibiting the use of health reimbursement arrangements and NAHB led the charge to pass legislation in 2016 that would not only reinstate their use, but also abolish punitive IRS penalties associated with them.

While the president’s executive order is an important step forward to address the issue of health care affordability for America’s employers, much more needs to be done to make the expansion of association health plans a reality.

It is still unclear what actions federal agencies will take to implement the changes outlined in the executive order and how states will respond to the presidential directive.

With small employers struggling to find affordable health care in the marketplace, NAHB will continue to work with the White House, Congress, and state and federal regulators to ensure the president’s executive order can be enacted across the nation.

For more information, contact Alexis Moch at 800-368-5242 x8407.

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Comments (14)

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  1. Randy Melvin says:

    A huge step forward to allow competitive free market health care solutions in lieu of authoritive big government dictates. Will NAHB be forming – offering group health policy for its members, either alone or as part of a group with some other associations-organizations?

    • NAHB Now says:

      Randy, thank you and great question. We are very excited by the President’s actions in signing the executive order on association health plans, but there are still a lot of unanswered questions that make next steps a little fuzzy at this point. While the general intent is clear, the executive order itself does not change existing law – rather, it directs federal agencies to determine the extent of the regulatory actions they can pursue to meet the President’s health care directives.

      So it will likely take several months before we see any rules or guidance issued, at which point we’ll get a better idea of how any national association plan would need to be structured and how state insurance regulators will respond. Additionally, it is likely that there will be legal challenges mounted as implementation starts to take shape which could impact things further.

      So stay tuned on this. NAHB has been very engaged with Congress and the White House on this matter and will continue to monitor the EO’s implementation and quickly determine what our best opportunities – and those of our affiliated HBAs – may be. The NAHB Senior Officers have already begun discussions to make sure we stay on top of the issue and are positioned in the best possible way moving forward.

      • Randy Melvin says:

        Thank you very much for your thorough and thoughtful reply on my question regarding the possibility of NAHB or it’s affiliates being able to offer competitive GROUP health insurance plans under the new Trump Executive Order. I was not surprised, but delighted to hear the associations leadership is closely tracking and seriously considering this potential opportunity. There are many of us who do not have access to affordable GROUP health care plans and are being crushed by the skyrocketing increases and high deductibles of the one size fits all INDIVIDUAL plans under the AHA-“Obama Care.” I believe if NAHB or it’s affliates can offer competitive group health care insurance plans that the associations membership retention and new membership will singnificant increase as people will find significant value in joining NAHB just to gain access to competivie Group healthcare insurance plans. Once this bring new members in the door they can learn about and become active in all the other valuable things NAHB does to advocate for the homebuilding and buying community.

  2. Lewis Sadler says:

    I know the HBA has workman’s compensation and general liability insurance but do we have a similar cost sharing type program for health insurance? If so I was and am not aware of it and would like more information.
    I live in Raleigh NC and am a member of the Raleigh Wake County HBA.

    Thank you

    • NAHB Now says:

      Lewis, thank you for your question. Do reach out to your local or state HBA for offerings that may be currently available in North Carolina. The North Carolina HBA staff contact page is on their website at https://www.nchba.org/wp/contact-us. Your local HBA in Raleigh may have more info as well.

    • Paul Kane says:

      There are no health insurance programs through either the state HBA or the Raleigh HBA at this time (and as NAHB’s response shows, there’s not one through NAHB either). The obstacles and financial viability of such a program have been too prohibitive. Perhaps this action by the White House can open the door to exploring this. As the article, and NAHB Now’s response to another inquiry reflect, it will take time for something like that to materialize. Personally, I hope something can be worked out.

  3. Rosty Caryk says:

    Really? All we know at this time is that it has thrown the current system into turmoil. Non of the actual rules have been written or implemented. Instead of blindly praising the action, you should at least try to give a more balanced review of potential results.

  4. Russell Wilson says:

    I will not be renewing my membership. Trump is an idiot that is dividing this country. I could not support anybody or any company that supports him. Taking the tax help away from low income family that need it the most is not right. So only the rich get care. That’s NOT how is should be in the USA.

  5. Congratulation. It has been a long time coming. PA Builders Association can fill you in on our history of Health Insurance

  6. Marty Knezovich says:

    Since most health insurance plans, in order to offer lower premiums, are based on a provider network system. Are you confident that the employees of the local builder associations have the knowledge or skills to negotiate with the health care providers in their area in order to be competitive with other insurance carriers? In my opinion you’re dreaming if you think that people with little or no medical experience are up to that task.

  7. Jim Geisling says:

    I am a health insurance broker in Michigan and I have a number of home builders that are looking for cheaper health insurance. They have to enroll in a new plan between November first and December 15th, how should I advise them? Do you think you will have an option outside of the Marketplace by then?

  8. Rosty Caryk says:

    One more comment, if anyone is interested in what neutral parties say:
    “Two months ago, the Congressional Budget Office estimated that individual health plan premiums would be 20 percent higher than originally projected if the [CSR] payments ceased. It also projected that premiums would be 25 percent higher than they otherwise would be by 2020, and that the federal deficit would be increased by almost $200 billion if the subsidies ended.”

  9. John Schmitz says:

    I am currently seeking health insurance for my 3 employees. I started the search because one of my employees received a letter from his current health insurance provider (Kaiser Permanente in Colorado) stating his premium will increase from $9,600 / year to $19,200. His plan for his family is garbage. $11,000 deductible and 30% out of pocket after that. This not health insurance, it is a paid “slight discount” plan. If I were to provide my 3 employees health insurance, the same “garbage” plan would cost my company $1,900 / month. My work comp insurance is $1,600 / month. General liability is $450 / month. This is all getting absurd. How do I pass through all these costs to my clients and stand to make a good living? Small business contractors are being squeezed. I may lose my employee with the family because he will have to go work for big corporate contracting in order to get insurance. My other option is to decrease my income to subsidize his insurance. Not exactly what I wanted after almost 17 years starting my business.

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