Senate health and labor committee Chairman Lamar Alexander (R-Tenn.) on Tuesday said that Labor Secretary Acosta’s proposed rule on Association Health Plans “could lower the cost of health insurance premiums and finally make affordable health insurance available to the 11 million American small business men and women and their employees or those who work for themselves—like farmers, or songwriters—who today are priced out of our health insurance system.”
Chairman Alexander made his comments at today’s Senate Health, Education, Labor and Pensions Subcommittee on Primary Health and Retirement Security roundtable on Small Business Health Plans chaired by Senator Mike Enzi (R-Wyo.). The Department of Labor’s proposed rule would allow more self-employed Americans and small businesses to band together to provide a small business health plan, otherwise known as an Association Health Plan (AHP)—which helps those employers reduce health insurance costs.
He said, “Last month, I went to the Chick-fil-A on Charlotte in Nashville. As I was about to leave, a lady walked up to me and said, ‘My name is Marty. I'm a self-employed farmer. And the year before Obamacare started, my monthly insurance premium was $300. Next year, it is $1,300, and it's very hard for me to afford.’ This proposed rule opens up new options for farmers in Tennessee like Marty to purchase more affordable health insurance with the same types of coverage and benefits that folks with coverage from large employers have.
“Here’s how: The Administration’s proposal would take down barriers to allow more self-employed Americans and small businesses to band together in what is called an Association Health Plan, or an AHP. By banding together in an AHP, employers could reduce the cost of providing health insurance to their employees through spreading the administrative costs, bargaining for better deals from insurers, and creating a way to bring in more healthy people, which brings down costs for everyone.”
“This proposed rule would mean access to lower-cost health insurance opportunities for small businesses. For example—the proposed rule would allow small local restaurants or retailers in a rural area to all participate in a single Association Health Plan to be able to offer insurance to their employees.
“For the first time, self-employed Americans would have the ability to band together and obtain health insurance on similar terms to large businesses. That presents a new opportunity for hardworking farmers, gig economy workers like Uber and Lyft drivers, songwriters, and artisans who today are priced out of our health insurance system.
“The proposed rule would also allow the formation of a new nationwide plan for all workers in an industry—for example, all of the local bakery owners from Nashville to Phoenix could band together and offer health insurance coverage to their bakery employees.
“I commend Secretary Acosta and the Trump Administration for taking this action. The answer to increasing access to affordable health insurance does not lie in increased federal spending, but in giving consumers more power to purchase the insurance that fits their unique health needs.”
Senator Alexander’s full prepared opening remarks are here.