The Department of Labor has announced a final rule that aims to strengthen healthcare protections for consumers in plans offered by small employers or available for purchase on the individual market. This decision aligns with the Biden-Harris administration’s goal of expanding access to quality health coverage for more Americans.
The new rule rescinds the 2018 rule that expanded the availability of Association Health Plans, which did not have to comply with several important consumer protections under the Affordable Care Act. This move is part of a broader effort by the Biden-Harris administration to eliminate substandard insurance options, as seen in a recent final rule on short-term, limited-duration insurance.
The final rule issued today also reverses the Trump administration’s criteria that made it easier for a group or association of employers to be treated as the “employer” when offering multiple-employer group health insurance. This change allowed more employers to offer health insurance coverage that bypassed critical ACA consumer protections.
In 2019, the U.S. District Court for the District of Columbia invalidated parts of the 2018 rule, prompting the Department of Labor to reevaluate its provisions. Assistant Secretary for Employee Benefits Security, Lisa M. Gomez, stated that the department now believes the provisions in question are not consistent with statutory requirements governing group health plans.
To eliminate uncertainty surrounding the 2018 rule, the Department of Labor has rescinded the entire rule and maintained longstanding pre-rule guidance on Association Health Plans that has been supported by numerous court decisions. This decision aims to ensure consumers have access to comprehensive, quality health coverage in compliance with federal law.
