Coalition opposes association health plans


WASHINGTON, May 12 (UPI) -- A coalition of health, insurance and policy groups said federal legislation on association health plans would make U.S. problems with access to healthcare and the uninsured worse, not better.

"We all agree that providing healthcare is a serious problem for small business today but we are convinced that association health plans would make a bad situation appreciably worse," said Debra Ness, president of the National Partnership for Women and Families, whose group is a leader of the 1,300-member coalition.


Seven coalition members expressed opposition to AHPs -- touted by the Bush administration as an important tool for small businesses to use to afford health insurance for employees -- at a National Press Club news conference Thursday.

They urged Congress not to pass as written the Small Business Health Fairness Act of 2005, which would establish association health plans on a federal level, allowing small business owners to cross state lines to buy insurance for their employees. Similar bills have made it through the House, but have been defeated in the Senate.


AHPs would be created by industry associations for their business members to purchase. The opponents said a major flaw in the legislation is that it exempts AHPs from state regulation and oversight they feel are crucial to maintaining consumer protections in force at the state level.

The Blue Cross and Blue Shield Association released a state-by-state analysis of all the consumer protections that would be lost if the legislation passes, including provisions that ensure health plans cover benefits such as cancer screening, diabetes supplies and education, and childcare.

The report, entitled "Association Health Plans: No State Regulation Means Loss of Protections for Consumers, Small Employees and Providers," said protections on how much and how often premiums can increase, the right to independent external review, and protections from fraud and abuse also would end with AHPs.

"The end result is disastrous for small businesses, workers and their families," said Mary Neil Lehnhard, senior vice president of the BCBS Association. "Association health plans would make health insurance companies less accessible and less affordable."

Lehnhard said AHPs "may sound good on the surface but would be a recipe for disaster for small businesses and their employees."

She added AHPs would not reduce reduce health care costs because most small businesses attracted to the plan type would be those that have healthy employees.


Bush supports association health plans because he views them as a way to allow small businesses to band together to negotiate lower-priced health insurance.

Labor Secretary Elaine Chao recently testified before the Senate Committee on Small Business and Entrepreneurship that AHPs would give millions of business owners and their employees healthcare access they currently do not have.

"Small business employers want to provide quality affordable health care coverage for their workers but are stymied by prohibitive costs and regulatory burdens," Chao testified. "That is why this administration strongly supports legislation that would increase access to health care for workers by making available to small business employers the benefits of association health plans."

Senate Majority Leader Bill Frist, R-Tenn., supports AHPs and has said he wants a floor vote on legislation this year.

The opposition groups said states are the laboratories where new healthcare options should start. Ideas like tax credits, purchasing pools and reinsurance pools all have been proposed to help encourage affordable healthcare.

"If AHPs become law this report (BCBS report) will be nothing more than an obituary of state health plans," said Jim Schlicht, chief government affairs advocacy officer with the American Diabetes Association.


Diabetes, the sixth leading cause of death in America, is growing by 8 percent per year and Schlicht said AHPs would exacerbate the diabetes problem by making diabetes education and supplies less available.

"Inadequate health coverage leads to poor disease management, which results in the risk of diabetes-related complications, including heart disease, blindness, kidney failure and amputations," Schlicht said.


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