For Consumers

Kreidler: President Trump's association health plan rule could destabilize insurance markets

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June 20, 2018

OLYMPIA, Wash. – The Trump Administration released its new federal rule yesterday expanding access to association health plans and creating a path for businesses and the self-employed to join the large employer market and avoid health plans governed by the Affordable Care Act. Below is Insurance Commissioner Mike Kreidler’s statement in response to the administration’s recent action:  

“Association health plans have played a large role in Washington state’s health insurance market for many years, but they followed strict federal guidelines for who could participate. The Trump administration’s new rule on association health plans opens the flood gates to more enrollees and will severely weaken our individual and small employer health insurance markets.

“Previously, federal law considered an association to be a large employer and allowed it to offer health insurance to its members, but only if the association was formed for a shared purpose other than to buy health insurance. Under this rule, that requirement is gone. Any group of employers can band together for the sole purpose of buying health insurance. I understand why this might seem like a good idea to some, but the damage it will do to consumers everywhere who rely on stable, affordable insurance markets is profound.  

“The administration’s promise that opening these alternatives up for small businesses and sole proprietors across the country will lead to lower costs is a ruse. People who buy these plans may see lower premiums, but they’ll also get fewer benefits and protections which could lead to costly surprises. 

“The Trump administration failed at repealing the Affordable Care Act, and now they have failed again at producing a viable and effective alternative. As I’ve said many times, the Affordable Care Act is far from perfect, but it moved us forward and away from a health care system that locked out millions. Yesterday’s announcement signals one more attempt by the administration to move us backward, where the young and healthy get affordable insurance and those who are unlucky enough to get sick pay the consequences.”