By Craig Sandler, Public Citizen
Recently, the U.S. Chamber of Commerce released an issue brief entitled “Association Health Plans: Everything You Need to Know.” The brief argues for expanded “association health plans” (AHPs)—junk health care plans with skimpy coverage and without Affordable Care Act protections—to address the problem of rising health insurance premiums.
In characteristic fashion, the Chamber has enthusiastically boosted an industry-friendly “solution” to a real problem – despite the fact that their proposal would not actually solve the core issue and would leave American households with inadequate coverage and the potential for huge medical bills if they get sick.
The brief points out that “[t]he number of small businesses offering health coverage has declined significantly over the years, from 47% in 2000 to 29% in 2016, in part because many entrepreneurs simply can’t afford to offer high-priced comprehensive plans.” Here, the Chamber has made the correct diagnosis—but its prescription is ill-conceived and misses the mark completely.
The Chamber favors a 2018 ruling instituted by the Department of Labor that would sabotage American health care. Recently, the U.S. District Court for the District of Columbia found that the DOL rule’s two key provisions are unlawful, and so parts of the rule have been halted and the establishment of new AHPs is currently prohibited. The Chamber, however, disagrees with this decision and has filed an amicus brief with an appellate court in an effort to have it reversed. With its issue brief, the Chamber hopes to make the case for AHPs as a supposedly great way to deal with rising premiums, when it would instead allow unscrupulous insurers to offer poor coverage.
If the District Court’s ruling were reversed, it would make it easier for insurers to offer these junk plans, which often exclude ACA required benefits, such as prescription drugs and quality maternity care. Enrollees who get sick could be responsible for significant expenses, forcing them into debt for care and even risking medical bankruptcy.
These plans are not required to meet many of the standards that were established under the Affordable Care Act. For instance, AHPs are allowed to charge different rates based on gender, age and location. And while they are not allowed to discriminate in coverage or pricing on the basis of pre-existing conditions, the Center on Budget and Policy Priorities notes that some AHPs can circumvent this prohibition by “consider[ing] the pre-existing conditions and the past medical claims of small business workers when setting premiums (known as ‘medical underwriting’).” This could mean that AHPs would target younger and healthier industries and workplaces to offer cheap rates, but leaving those workers on the hook for huge expenses down the road.
Furthermore, expanding AHPs would have the disastrous effect of further destabilizing the Affordable Care Act marketplaces. By cherry-picking the youngest and healthiest Americans through attracting them with deceivingly lower premiums, they would leave only the sick to be covered under ACA-compliant plans, causing premiums for such plans to rise. Allowing the sale of poorly regulated plans takes us back to a time when greedy insurers offered false promises to consumers and abandoned them when they got sick.
It is true that small businesses struggle to provide adequate health care benefits to their employees due to the rising costs of health care. However, covering those employees under sham AHPs with skimpy coverage is not the answer. Instead, we must confront the actual root of the problem: the private insurance market’s bottomless appetite for profiting from Americans’ illness.
A far more sensible solution is for the United States to adopt Medicare for All. Under such a system, small businesses would no longer have to worry about providing insurance to their employees; instead, those employees would be automatically enrolled in guaranteed coverage that does not discriminate by age or gender and would not leave employees in the lurch. Employers would even benefit from the fact that Medicare for All would improve Americans’ overall health, reducing sick days taken and increasing productivity.
Of course, the Chamber would never concede that expanding and improving Medicare to cover all Americans is the best way to solve the problems of excessive health plan costs. It would never want to endanger the profit margins of its industry cronies in Big Pharma, private insurance, biotechnology and others who rely on the cruelty and callousness of our disastrous for-profit health care system. Indeed, the Chamber is actively working to obstruct the momentum of Medicare for All, with Chamber president Tom Donohue promising to “use all of our resources to combat” such reform.
We should reject AHPs and any other corporate-approved proposals that pose as “solutions” to the issues of excessive health care costs in America. The Chamber loves to endorse measures that masquerade as solutions but actually exacerbate or perpetuate the injustices in our society. The public should see those proposals for the charade they are. Instead of adopting industry-friendly solutions to industry-caused problems, we must demand Medicare for All because it would finally put people ahead of profits when it comes to health care in America.