A new report released by associationhealthplans.com show that association health plans offer many benefits and are being utilized:
- Regional associations launched 71 percent of new AHPs
- Vast majority of new regional associations are chamber of commerce-based
- 4 out of 5 new AHPs are insured through a third-party insurance company as opposed to self-funded
- Maximum savings claims average higher for self-funded plans than fully-insured plans, though both are in double digits
- Half of new AHPs offer medical savings account options such as a HSA
- Multi-state professional association health plans in planning but taking longer to reach market
- Half of new AHPs are limited to companies of 2-50 employees
- 43 percent of new AHPs are available to sole proprietors and the self-employed
- Benefit information trends toward comprehensive health coverage that includes items such as mental health benefits and prescription drug coverage alongside mandated benefits such as maternity
Association health plans mainly benefit those who do not get their insurance from work and cannot afford the plans that are sold on the state exchanges. These plans are not for everyone. However, many small business employees, small business owners, or self-employed owners benefit greatly from access to these plans. They offer an opportunity for those who get health insurance in the small or individual group markets to band together to have the purchasing power that large businesses do.
North Carolina is currently engaged in a debate over how to proceed with these plans. If the Department of Insurance and the General Assembly will allow the easy formation and use of these plans they have the potential to bring relief to people who were forgotten by the Affordable Care Act and cannot afford the coverage.
Look out next week for a John Locke research update concerning the future on association health plans.