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Cheaper Health Plans Raise Concerns

Inexpensive plans known as association health plans (AHPs) are raising concerns.
October 24, 2017

President Donald Trump’s recent executive order asserts that millions of Americans may soon obtain good health coverage through inexpensive plans known as association health plans (AHPs) that are geared toward small businesses. However, the Labor Department says in many cases, it has targeted “unscrupulous promoters who sell the promise of inexpensive health benefit insurance, but default on their obligations.”

Marc I. Machiz, who investigated insurance fraud as a Labor Department lawyer for more than 20 years, said the executive order was “summoning back demons from the deep.” He said AHPs
“operate in a regulatory never-never land between the Department of Labor and state insurance regulators.”

READ: Issue Brief on AHPs by American Academy of Actuaries

Association health plans, properly operated and regulated, can provide a legitimate option for small employers seeking affordable coverage, and President Trump and other Republicans see the plans as an important part of any replacement for the Affordable Care Act.

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