The U.S. Senate, on May 11th, blocked legislation (S 1955) that would have allowed small businesses to join together and create association health plans, falling five votes short of the 60 votes needed to limit debate on the measure.
The bill was defeated in a 55-43 vote, mostly along party lines. The legislation, sponsored by Sen. Mike Enzi (R-WY), chair of the Senate Health, Education, Labor and Pensions Committee (HELP), would allow small businesses and trade associations to form association health plans across state lines. Under the bill, insurers would be permitted to sell plans to businesses and individuals that do not meet current state benefits requirements. However, they then also would have to offer a plan with benefits provided under a state employees' plan in one of the five most heavily populated states -- California, Florida, Illinois, New York and Texas. In addition, the bill would preempt state laws that limit how much insurers can vary premiums from one small business to another.
Of concern to mental health advocates, including AMHCA, was that the measure would have allowed insurers and small businesses to bypass state-mandated protections, including mental health parity laws, Any Willing Provider, Freedom-of-Choice and other mandatory reimbursement laws. Supporters of the measure, which included the Bush administration, believed it would help more small companies offer coverage by freeing them from having to comply with expensive and varying state requirements.
The defeat in the Senate may pave the road for a compromise measure to be considered prior to the end of this session of Congress. AMHCA will keep its members apprised on this issue as updates are needed.
For more information about this issue, please Beth Powell with AMHCA at 800-326-2642, ext. 105 or by e-mail at email@example.com