How AHPs Benefit State and Local Chambers of Commerce

Wednesday, August 4, 2010 - 8:00pm

Any Association Can Offer a Federally-Qualified SBHP

  • The ability to sponsor an SBHP is not limited to national associations — state and local Chambers of Commerce may also apply for federal SBHP certification.
  • The only pre-condition is that the sponsoring association be organized for a purpose other than offering insurance and have been in existence for at least three years.

Chambers of Commerce Will Have Greater Flexibility in Sponsoring Member Health Benefit Programs

  • ERISA preempts costly state benefit mandates and rating restrictions.
  • Chambers of Commerce that revise their affinity health benefit programs to conform with federal SBHP requirements would be required only to meet federal requirements and could charge premium rates according to their own membership's experience.

Chamber Health Plans Could Be Offered Across State Lines

  • Chambers serving an area that crosses state borders could offer their plans to the regional business community, or forge partnerships with other local Chambers of Commerce and expand the risk pool, reducing per capita costs.
  • A state or local Chamber that offers a health plan with a unique benefit design that is not available in other states and which does not rely on network negotiated rates could even offer its plan nation-wide — providing small business owners with health plan options that would never have been possible otherwise.
  • Small businesses that are growing may employ employees in more than one state but are still too small to assume the risk of self-insuring and consequently must juggle health plans for each state in which they have employees. Through an SBHP offered through a regional or national partnership, small businesses can provide uniform coverage to their employees and simplify their administrative overhead in managing health benefits — and concentrating on making their small businesses bigger.

Federal Consumer Protections Will Protect Plan Enrollees

  • The Department of Labor now enforces ERISA protections for 136 million Americans. While costly state benefit mandates and rating restrictions will be preempted, federal case law is evolving to guarantee certain state consumer protections for ERISA plans — which would also apply to SBHPs.