Trump-Era Association Health Plan Rule Reversed by Biden Administration: What This Means for Small Businesses and Self-Employed Individuals

In a move to reverse a controversial rule introduced during the Trump administration, the Department of Labor has announced that small businesses and self-employed individuals will no longer be able to use association health plans that do not comply with all of the Affordable Care Act’s requirements. The final Biden rule on association health plans is set to be published in the Federal Register on April 30.

The previous rule, which was implemented in 2018, had expanded the definition of “employer” to make it easier for businesses to pool together to purchase health insurance under the ACA. This was seen as an affordable way for smaller businesses to provide coverage for their employees who may not be able to afford traditional plans that met all of the ACA regulations.

However, critics of the Trump-era rule argued that this would lead to increased premiums for those remaining on Obamacare plans. Additionally, healthier individuals may have left the marketplace in favor of these cheaper plans, leaving sicker and more expensive groups behind. This could have resulted in higher premiums for those who remained on traditional Obamacare plans.

Prior to the 2018 rule, association health plans (AHPs) were only available to small business groups within common industries. The older rule was partially struck down by a court in 2019, leading some AHPs being discontinued. Many business groups have expressed a reluctance