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House Passes AHP Bill

On May 13, the U.S. House of Representatives passed H.R. 4281, a bill to create Association Health Plans (AHPs). The vote marked the second time...
May 18, 2004

On May 13, the U.S. House of Representatives passed H.R. 4281, a bill to create Association Health Plans (AHPs). The vote marked the second time during this Congress that AHP-enabling legislation has been approved by House lawmakers. H.R. 4281 is identical to an earlier AHP bill, H.R. 660 which was passed by the House in June 2003. small businesses would be able to pool together on a national basis through trade associations and either purchase their health insurance from a provider or self insure.

Senator Olympia J. Snowe, (R-Maine) has introduced a companion bill, S. 545, the Small Business Health Fairness Act, now pending in the Senate. "By passing this bill a second time with a strong bipartisan vote, the House has made it clear this legislation has broad support and should be enacted. The Senate must act to give small firms more and better choices for providing insurance to their employees," said Snowe, Chair of the Senate Committee on Small Business and Entrepreneurship.

Advocated by small business groups, proposals to allow AHPs are opposed by the National Conference of State Legislatures (NCSL), the National Conference of Insurance Legislators (NCOIL) and the National Association of Insurance Commissioners (NAIC). NAIC has issued a statement detailing why it believes AHPs are bad for consumers. Also last week, NCOIL sent a letter to members of the Senate Health, Education, Labor, and Pensions Committee in which NCOIL President, State Senator Steven Geller (R-Florida), said that the bill "would have dire consequences, increasing the potential for fraud and abuse, undermining state health reforms, eliminating consumer protections, and would severely impede the ability of states to identify and shutdown fraudulent insurers."

NAIC Position Statement on AHPs

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