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Bush Pushes AHPs, Kennedy to Introduce Employer Health Bill

In his State of the Union address, President Bush renewed his call for Congress to pass legislation allowing for the creation of Association Health Plans...
January 28, 2004

In his State of the Union address, President Bush renewed his call for Congress to pass legislation allowing for the creation of Association Health Plans (AHPs) that would allow small businesses to pool their employees through bona fide associations, giving them the opportunity to negotiate lower health insurance premiums as a group. Last year, the House passed AHP legislation (H.R. 660) but a companion proposal (S. 545) by Sen. Olympia Snowe (R-Maine) was not passed in the upper chamber. Snowe said winning Senate approval of her AHP bill is one of her highest priorities this year.
 
At the same time, Sen. Edward Kennedy (D-Massachusetts) announced he will introduce legislation that would require all employers to provide employees with health insurance that offers benefits similar to those provided for federal employees. Kennedy said that under his bill, no employer would have to spend more than 12 percent of payroll for employee health insurance.
 
He added that if health costs rise faster than a fair average of other costs, the government will cover the difference. Kennedy said it is now time to tell employers that, as with Social Security and Medicare, businesses also have an obligation to contribute to the cost of health care for their employees.
 
What It Means to Agents: These two approaches to expanding health insurance vividly illustrate the different approaches being advocated. Underlying the debate is a growing belief that something needs to be done by Congress to reduce or eliminate the problem of uninsured Americans.

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