The Employee Benefits Security Administration (EBSA) has issued a final rule aimed at strengthening healthcare protections for consumers in plans offered by small employers or available for purchase on the individual market. This move aligns with the Biden-Harris administration’s goal of expanding access to quality health coverage for more Americans.
The new rule rescinds the 2018 rule that expanded the availability of Association Health Plans, which did not have to comply with several important consumer protections under the Affordable Care Act (ACA). This decision is part of a broader effort by the Biden-Harris administration to eliminate substandard insurance options, as seen in a recent final rule on short-term, limited-duration insurance.
The Trump administration’s criteria that made it easier for a group or association of employers to be treated as the “employer” when offering multiple-employer group health insurance has been reversed by this change. More employers were able to offer health insurance coverage that bypassed critical ACA consumer protections because of this change.
In 2019, the U.S. District Court for the District of Columbia invalidated parts of the 2018 rule, prompting the Department of Labor to reevaluate its provisions. Assistant Secretary for Employee Benefits Security, Lisa M. Gomez, stated that the department now believes these provisions are not consistent with statutory requirements governing group health plans.
To eliminate uncertainty surrounding the 2018 rule and maintain longstanding pre-rule guidance on Association Health Plans supported by numerous court decisions, the Department of Labor has rescinded this entire rule. This decision aims to ensure consumers have access to comprehensive and quality health coverage in compliance with federal law.
This move is just one step towards achieving President Biden’s goal of ensuring Americans have access to affordable and quality healthcare coverage regardless of their income or employment status.