Are Low Cost Associated Health Plans Worth It?

Are Low Cost Associated Health Plans Worth It?

Your health is great, until it isn’t. Health care plans that are pitched to someone who is healthy may not necessarily cover them when sick, especially if a low cost Associated Health Plan (AHP) is purchased. The latest news in healthcare is the introduction of AHPs that offer alternative coverage that is not governed by the Affordable Care Act. These plans boast being a cost saver for small businesses and sole entrepreneurs. Although plans will be flexible and inexpensive, they will come with many unknowns detailed in fine print. Businesses and the insured will have to beware.

I have personally negotiated with Associated Health Plan providers that have fallen short of their coverage terms because of standard coverage oversight and funding failures. AHPs were available prior to the Affordable Care Act and some plans continued to operate outside of the standard health coverage requirements mandated by the ACA. These plans can suffer from funding shortages, coverage that is not comprehensive or easily understood by the insured and oversight is a jurisdictional nightmare.

AHPs that are now available allow small businesses and individuals to band together based on geography or professional interest to purchase health care. A new feature of AHPs are the ability of associations to come together for the sole purpose of purchasing healthcare. These associations then have to fund the healthcare for their members. Unfortunately, it is possible that the investments that the associations purchase and receive to provide healthcare coverage may not be enough all the time. Before investing in a AHP make sure to inquire about their funds.

AHPs will allow for different coverage options and specific coverage will not be mandated by the ACA. With no standard of care to adhere to within AHP’s employers will have the ability to pick and choose what services they cover.

An unfortunate possibility is employers like Hobby Lobby only contracting with an AHP that adheres to their religious beliefs. In 2014 the Supreme Court ruled that the ACA birth control mandate was not the least restrictive method on religious freedom to enforce equal access to birth control. It was instead suggested by the court that the government or an insurance company cover the cost of the ACA mandate rather than unreasonably infringing on the rights of small business owners. AHPs will not be mandated by the requirements of the ACA, therefore, if an employer only contracts with a AHP that does not offer birth control then there is no longer a duty on the government or the insurance companies to supplement this cost. It will be up to the insured to lobby for their coverage rights to their employer and healthcare association.

Holding AHP providers accountable may also become a jurisdictional struggle for the insured. A benefit of the plans mandated by the ACA is the court’s ability to require coverage for care from an insurance company on a state and federal level.  An AHP could offer coverage to some or all employers in a state, city, county, or a multi-state metro area, or it could offer coverage to businesses in a trade or industry group nationwide. Insurance companies will avoid being called into court if and when possible claiming the court doesn’t have jurisdictional oversight over them. While this legal tactic may not result in a dismissal it will be just one more step that the insured will have to take to get the coverage they may be entitled to receive.

Seeking out the least expensive healthcare plan can be appealing at first glance. It is imperative buyers pay attention to the limitations of coverage, as more plans are introduced outside of the ACA standardized healthcare market, like self-insured companies and associated health plans. The glimpse of making America’s health care Great Again reveals a competitive market that will require advocates on your side.

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