Today the Department of Labor issued final rules governing the creation of association health plans (AHP).
Under the rule, AHPs would be exempt from current benefit and cost-sharing requirements. Such plans could, for example, exclude coverage for prescription drugs or other essential health benefits, cap coverage based on number of hospital days and cover less than 60 percent of a patient’s medical costs.
In addition, while the final rule prohibits AHPs from denying coverage based on pre-existing conditions, it does allow such plans to impose different rates on groups based on the age, gender, group size and location of enrollees. It also allows an AHP that is formed on a geographic basis to exclude certain geographic areas from membership. These changes amount to discriminatory tactics and could have the same effect as considering someone’s health history.
A statement from the American Cancer Society Cancer Action Network (ACS CAN) follows:
“This rule will seriously erode the availability of affordable comprehensive coverage in most states’ individual and small group markets that is critical to cancer patients and survivors. These products could leave gaps in coverage and could require patients pay very high out-of-pocket costs. AHPs will be able to design products that appeal only to young, healthy, low-risk enrollees, leaving older and sicker Americans to pay ever-increasing premiums for plans that meet their needs.
“These changes combined with the elimination of the individual mandate penalty and the proposal to extend and expand short-term policies will likely weaken and divide the insurance market to the point where those with any kind of health problems, especially a serious condition like cancer, will have few if any affordable options.
“ACS CAN encourages states to take into account patient needs and move to protect and strengthen their insurance markets with state laws regulating these new and potentially damaging insurance products. ACS CAN stands ready to work with state lawmakers in this effort.”