In June 2018, the federal government published a new ruling regarding Association Health Plans or AHPs. This new ruling allows businesses to come together and bargain as one group to obtain better pricing for healthcare plans.
A business with 50 or more full time or full time equivalent employees is considered a large group, and moves into a more competitive pricing bracket. Now businesses can combine together as an AHP and be treated as a single large employer to receive this preferential pricing.
One of the concerns is that large groups are not required to follow the same rules as plans in the small group or individual markets. Most importantly, these large group plans do not have to provide the ten essential health benefits (EHB’s) required by the ACA. Just in case you don’t have those ten EHB’s memorized, here they are:
Outpatient hospital care
Pregnancy, maternity and newborn care
Mental health and substance abuse services
Rehabilitative and habilitative services and devised
Preventative, wellness and chronic disease management services
Pediatric services (including oral and vision care)
This isn’t to say that AHP plans won’t cover the above EHBs, but be aware that the plans do not have to and read carefully if you are considering one! It is easy to see why an AHP may be significantly less expensive if it doesn’t cover, say, emergency services. Make sure that this is something you cover with your health insurance agent when considering an AHP.
Are there AHPs that are forming now that I can join?
Yes, there are. SBAM and MichBusiness have come together to create TranscendAHP, a nonprofit, federally enabled association health plan in partnership with Blue Cross Blue Shield of Michigan and Blue Care Network. There will be 10 large group products, all of which would be already available to you if you were a large group employer.
Businesses looking to join an AHP are predicted to save between 3 and 5 percent this coming year, although they must also calculate in the cost of a membership to either SBAM ($109) or MichBusiness ($150), and also TranscendAHP (Between $100 and $200), if not already a member. Alternatively, a business could join TranscendAHP directly for between $250 and $350, but then would miss out on some of the benefits of either SBAM or MichBusiness.
If you want to find out for sure whether or not an AHP will save you money, give us a call for a quote! All AHP business will be going through health insurance brokers like Cedar River Insurance, and we would be happy to help you find out if you can save money for 2019!
All of the information coming out about AHPs is new, and we are getting you the information as fast as we are getting it. Any predicted rate reductions are predictions from TranscendAHP or people working directly with them, so we haven’t confirmed these rate reductions for ourselves yet. But stay tuned! We will be testing the system and will bring you new information as we have it.
Cedar River Insurance Agency
2143 Commons Parkway
Okemos, MI 48864