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July 26, 2005

Association Health Plans; Actuaries Still Raise Concerns as Congress Poised to Vote on Legislation

health.jpgAs the U.S. House of Representatives prepares to vote on legislation contingent on getting assurances for association health plans (AHPs), the American Academy of Actuaries raises concerns that the legislation, in its current form, still does not address the main problem of America's health care crisis: the rising costs, among other things.

The legislation regulating association health plans (H.R. 525) would allow small businesses to join together through their membership in a trade or professional association to offer health insurance to their employees. The Academy's Association Health Plan Work Group has introduced six issues of major concern that Congress needs to address in the Issue Brief: Frequently Asked Questions on AHPs.

"The bill in its current form could result in negative consequences for AHPs if the legislation is passed," said Karen Bender, chairperson of the Academy Association Health Plans Work Group. The areas of concern that Bender noted include whether AHPs will be regulated by the U.S. Department of Labor or at the state-level, will surplus requirements for self-funded AHPs be sufficient enough to remain solvent, and will they be on equal footing with other health plans in the states where AHPs operate.

Other areas of concern about the legislation are whether AHPs will provide similar benefits to those provided by other health plans in the states where AHPs operate, whether different rating rules for AHPs will benefit the market, and do AHPs allow small employers to have more buying power, and will this reduce costs?

To view the issue brief, go to http://www.actuary.org/pdf/health/ahp_mar05.pdf. To interview Karen Bender, please contact Tracey Young, the Academy's media relations manager by phone at 202-785-7872 or by e-mail at young@actuary.org

The Academy is a 15,000-member non-profit, non-partisan professional association representing all actuaries practicing in the United States. Based in Washington, D.C., the Academy conducts an extensive public policy program at the state, federal, and international levels, bringing actuarial expertise to bear on issues such as Social Security, Medicare, insurance regulation, and pension reform. The Academy also sets and maintains standards of actuarial qualification and practice.

The American Academy of Actuaries is the nonpartisan public policy organization for the U.S. actuarial profession. The Academy provides independent analysis to elected officials and regulators, maintains professional standards for all actuaries, and communicates the value of actuarial work to the media and public.

Posted by Tom Troceen