House OKs association health plans

Published on

The Washington Times

The House yesterday approved a bill that would give major trade associations the power to pool their members nationwide and buy discounted health insurance that is not governed by state regulations.

The House voted 263-165 on the “association health plans,” which are backed by the Bush administration.

Similar measures have been introduced in the Congress for the past decade. Several have passed the House, but none has made it through the Senate.

The current bill allows trade groups, chambers of commerce and other business organizations to bargain for health care coverage that crosses state lines. The health plans will be regulated by federal laws.

Most labor unions and large corporations purchase their health insurance under those rules, said Rep. Sam Johnson, Texas Republican and sponsor of the bill.

“Small businesses will save as much as 30 percent on their health insurance” by grouping under an association health plan, Mr. Johnson said on the House floor during yesterday’s debate.

But other lawmakers and consumer groups argued that consumers under the health plans would lose state consumer protections and certain services because federal law does not mandate them.

State requirements for coverage of services like diabetes treatments and breast-cancer screenings could be eliminated under the health plans, said Carmen Balber, spokeswoman for the Foundation for Taxpayer and Consumer Rights, a Santa Monica, Calif., consumer advocacy group.

“This bill does pre-empt consumer protections provided by the states,” said Rep. Ron Kind, Wisconsin Democrat.

Association health plans would be regulated by the federal Department of Labor rather than state insurance commissioners.

But unlike the states, the federal agency does not have the power to immediately shut down a fraudulent insurance plan. Instead, the Labor Department must file a lawsuit in federal court and win the case to take action.

The debate on the bill comes as the House is scheduled to vote on several health bills this week.

The House is expected to vote tomorrow on a medical tort-reform bill that would put a $250,000 cap on noneconomic damages for medical-malpractice cases.

Other bills that are expected to get a House vote this week would extend federal funding for high-risk insurance policies that are run by the states and set up tax credits for consumers who use health savings accounts.

While the association health plans bill passed the House, supporters of the measure are unsure how it will do in the Senate, where a similar version is pending.

“But we are more optimistic than in past Congresses, largely based upon more interest from the Senate,” said Brian Crawford, spokesman of the Associated Builders and Contractors, an Arlington trade group for construction-related businesses, which hopes to offer the health plan to its members.

Consumer Watchdog
Consumer Watchdoghttps://consumerwatchdog.org
Providing an effective voice for American consumers in an era when special interests dominate public discourse, government and politics. Non-partisan.

Latest Videos

Latest Releases

In The News

Latest Report

Support Consumer Watchdog

Subscribe to our newsletter

To be updated with all the latest news, press releases and special reports.

More Releases