Feds Post Association Health Plan Instruction Book

What are some key AHP regulation effective dates?

Associations have been able to start fully insured AHPs under the new regulations since Sept. 1.

Existing associations with self-insured AHPs can expand the AHPs, to take advantage of the new regulatory flexibility, Jan. 1, 2019.

Associations will be able to start new, self-funded AHPs under the new rules starting April 1, 2019.

What's EBSA?

EBSA is the arm of the U.S. Department of Labor (DOL) that oversees federal laws, regulations and programs that relate to group health insurance, pension plans, defined contribution retirement plans, and other employer-sponsored health benefits that fall under the scope of Employee Retirement Income Security Act of 1974 (ERISA).

Most of the time, when employee benefits and retirement services professionals are talking about something the DOL has done, they're talking about something EBSA has done.

What's in the new AHP guide?

EBSA officials summarize the benefits, disclosure, claim administration and financial reporting rules that apply to AHPs formed under the new rules.

Officials say they may shut down an AHP that is in a financially hazardous condition or marketed in a deceptive way, and that they may impose criminal penalties on AHP marketers who make false statements about the AHPs.

Officials note that AHP sponsors and managers can apply for "prohibited transaction exemptions"  (PTEs) from the ERISA fiduciary rules that apply to benefit plans, just as managers of retirement plans or single-employer health plans can.

In theory, for example, ERISA could block an association from hiring an affiliate to administer an AHP. EBSA officials say an association with an AHP can apply for a PTE to get permission to hire an affiliate to help with AHP administration.

EBSA officials also address a question that has been of concern to state officials who are skeptical about multi-state AHPs: "Do the states have any authority over AHPs?"

Here's what EBSA officials say about whether states' have authority over AHPs:

Yes. ERISA expressly provides both the Department and State insurance regulators joint authority over AHPs. In addition, States can regulate health insurance issuers and the health insurance policies they may sell to AHPs, and they can regulate self-insured AHPs to the extent the regulation is not inconsistent with ERISA. The new rule does not diminish state oversight. Employers and plan administrators should check with the applicable state insurance department for more information on that state's insurance laws.

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