The Biden-Harris administration has announced a final rule issued by its Employee Benefits Security Administration (EBSA) that will enhance healthcare protections for consumers in plans offered by small employers or available for purchase on the individual market. The rule is aligned with the administration’s goal of increasing access to quality health coverage for more Americans. EBSA is rescinding the 2018 rule that expanded the availability of Association Health Plans, which did not need to comply with certain consumer protections under the Affordable Care Act (ACA).
In addition to cracking down on junk insurance with a recent final rule on short-term, limited-duration insurance, the administration has reversed lax criteria put in place by the Trump administration that allowed a group or association of employers to be treated as the “employer” when offering multiple-employer group health insurance. This change made it easier for employers to offer coverage that evaded critical ACA consumer protections. A 2019 U.S. District Court decision invalidated parts of the 2018 rule, finding them to be an unreasonable interpretation of the Employee Retirement Income Security Act (ERISA).
Assistant Secretary for Employee Benefits Security, Lisa M. Gomez, explained that the Department of Labor no longer believes the provisions of the 2018 Association Health Plan Rule are consistent with the best reading of the statutory requirements governing group health plans. The department is rescinding the entire 2018 rule to eliminate any uncertainty about the status of the standards it established, maintaining longstanding pre-rule AHP guidance that has received consistent support from judicial decisions. This action is in line with President Biden’s directive to improve coverage comprehensiveness and ensure consumers have access to quality coverage in accordance with federal law.
