ACAP Comment Letter on Association Health Plans

March 6, 2018

Preston Rutledge, Assistant Secretary
Employee Benefits Security Administration
Department of Labor

Submitted electronically via:
RE: RIN 1210–AB85

Dear Assistant Secretary Rutledge:

The Association for Community Affiliated Plans (ACAP) respectfully submits comments regarding EBSA Definition of “Employer” under Section 3(5) of ERISA – Association Health Plans.

ACAP is an association of 61 not-for-profit and community-based Safety Net Health Plans (SNHPs) located in 29 states. Our member plans provide coverage to more than 20 million individuals enrolled in Medicaid, the Children’s Health Insurance Program (CHIP) and Medicare Special Needs Plans for dually-eligible individuals, including over 700,000 Marketplace enrollees. Nationally, Safety Net Health Plans serve almost half of all Medicaid managed care enrollees. Fourteen of ACAP’s Safety Net Health Plan members offer qualified health plans (QHPs) in the Marketplaces in 2018.

Summary of ACAP’s Comments
ACAP has chosen to respond to a subset of proposals in the proposed rule that are particularly relevant to Safety Net Health Plans (SNHPs). ACAP appreciates the Administration’s recognition of the importance of access to affordable health insurance coverage and recognition of the need for consumer protections in doing so. ACAP’s comments are focused on ensuring that there are adequate consumer protections in place and that there is not a resulting deleterious impact on the individual market risk pool that would cause premiums to spike for Qualified Health Plans (QHPs) offering coverage in the Marketplaces. Only a limited number of ACAP’s member plans offer small group coverage, so our comments herein are focused predominantly in the impact to the individual market. Specifically, our comments are focused so as not to place undue burden or harm on either SNHPs or consumers, in particular the low-income and vulnerable populations that are traditionally served by these SNHPs.

In particular, we wish to draw attention to the following sections of our comments:

Risk Pooling: Nondiscrimination Protections & Administrative Efficiencies: ACAP supports the nondiscrimination requirements as set out by the Administration but firmly believes that other protections, to align with those akin to QHP offerings, are warranted. In addition, ACAP does not believe that AHPs will be able to achieve sufficient administrative efficiencies to make a difference in premium savings.

State Regulation: ACAP urges the Department not to permit any exception to State regulatory authority of AHPs.

Benefit Package Notice Requirements: ACAP urges the Department to develop notice requirements for employers and employees who may potentially enroll in an AHP to ensure they are aware of the differences between AHP and QHP benefit packages.

Evaluation: ACAP urges the Department to develop a thorough set of evaluation criteria and to reevaluate this regulation over the coming 2-3 years, to ensure it is not having a detrimental effect on the individual and small group market risk pools or a dilatory impact on the cost and quality of plans available to consumers—both those enrolled in AHPs and in individual and small group market plans.