[Congressional Record Volume 165, Number 63 (Thursday, April 11, 2019)]
[Senate]
[Pages S2437-S2439]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. ENZI (for himself, Mr. Alexander, Mr. Barrasso, Mr. 
        Cornyn, Mr. Isakson, Mr. Braun, Mr. Blunt, Mrs. Capito, Mr. 
        Inhofe, Ms. McSally, Mr. Thune, Mr. Sasse, Mr. Romney, Mrs. 
        Hyde-Smith, Mr. Grassley, Mr. Cramer, Mr. Kennedy, Mr. Scott, 
        of South Carolina, Ms. Ernst, Mr. Perdue, Mr. Wicker, Ms. 
        Murkowski, Mr. Daines, Mr. Lankford, and Mr. Graham):
  S. 1170. A bill to amend the Employee Retirement Income Security Act 
of 1974 to establish additional criteria for determining when employers 
may join together in a group or association of employers that will be 
treated as an employer under section 3(5) of such Act for purposes of 
sponsoring a group health plan, and for other purposes; to the 
Committee on Health, Education, Labor, and Pensions.
  Mr. ENZI. Mr. President, I rise to introduce the Association Health 
Plans Act of 2019. I have been championing association health plans, 
which I sometimes call small business health plans, for more than 15 
years. As a small business owner, I understand firsthand the 
difficulties these employers face trying to provide health insurance 
for their employees. Small business owners want to provide 
comprehensive health insurance to their employees, but it can be a real 
struggle to afford those plans. In part due to these pressures, the 
number of small businesses offering coverage has dropped substantially 
over the years, from 47 percent in 2000 to 30 percent in 2017.
  Few families are shielded from the rising costs of healthcare and, by 
extension, the rising cost of health insurance, but among the hardest 
hit are American small businesses.
  Small businesses have limited ability to pool risk and lack coverage 
in the market, so they often end up paying more for health insurance 
than large employers who have more buying power. According to the 
National Conference of State Legislatures, small businesses pay about 8 
to 18 percent more on average than large businesses for the same health 
insurance policy.
  To put it another way, one family shoe store probably can't get an 
insurance company to play ball, but 1,000 family shoe stores probably 
could. This is the premise of the association health plans. Let's let 
small businesses band together and leverage their shared power in 
numbers to obtain comprehensive and affordable health insurance as 
though they were a single large employer.
  This does not mean they are allowed to cut corners. The coverage 
offered to association members is subject to the consumer protection 
requirements that apply to large employers. That includes important 
consumer protections established on a bipartisan basis under the 
Employee Retirement Income Security Act, ERISA, the Health Insurance 
Portability and Accountability Act, HIPAA, and the Consolidated Omnibus 
Budget Reconciliation Act, COBRA. Association health plans also comply 
with the Affordable Care Act requirements for large-employer health 
plans.
  Association health plans are not a new concept. They have long been 
permitted under Federal law. For example, the Wyoming Chambers Health 
Benefit Plan has served Wyoming's Chambers of Commerce since 2007. It 
currently offers comprehensive and affordable coverage to 11 local 
Chambers of Commerce, 52 employers, and 255 employees.
  Last year, the Trump administration issued a new rule that made it 
easier for small businesses to band together for the purposes of 
offering an association health plan. Specifically, the Department of 
Labor created a new ``pathway'' for forming the association so that 
small businesses can band together by common industry or common 
geography. For example, flower shops across the Nation might band 
together to offer an association health plan, or small businesses in 
unrelated professions might band together just within my State of 
Wyoming.
  The final rule also allowed self-employed Americans to receive 
coverage through association health plans established under the new 
pathway. It did not rescind the old pathway, so association health 
plans in existence before the final rule can continue to operate 
unchanged, or new ones can use that pathway to form.
  The final rule also does not change existing ERISA preemption rules 
that authorize broad State insurance regulation of association health 
plans either through health insurance issuers or directly in the case 
of self-insured association health plans. I will repeat that again. The 
final rule does not change existing ERISA preemption rules that 
authorize broad State insurance regulation of association health plans 
either through health insurance issuers or directly in the case of 
self-insured association health plans.
  Roughly 30 association health plans have formed under the new pathway 
since the Department of Labor finalized the rule. For example, the Las 
Vegas Chamber of Commerce formed an association health plan covering 
500 small businesses and 100 sole proprietors. The Georgia Chamber of 
Commerce began taking steps to launch a new self-insured association 
health plan that could eventually enroll 800,000 people. Two Michigan 
small business associations joined forces to create an association 
health plan that has enrolled nearly 400 small businesses throughout 
the State.
  There are likely more to come. According to the Congressional Budget 
Office, about 4 million people are expected to enroll in association 
health plans by 2023, including 400,000 who would otherwise be 
uninsured.
  All of this is to demonstrate one simple fact: Association health 
plans work. They provide coverage to people who would not otherwise 
have it, and they provide comprehensive health benefits at an 
affordable price.
  Unfortunately, a Federal district judge vacated the Labor 
Department's final rule, threatening to disrupt coverage for tens of 
thousands of enrollees in association health plans formed under the 
final rule and threatening to restrict the ability of small businesses, 
working families, and self-employed Americans to band together to 
obtain affordable and high-quality health insurance in the future.
  My bill will simply codify the Labor Department's final rule to 
provide certainty for current enrollees and to ensure the pathway 
remains available for new association health plans to form. It is not 
intended to disrupt the State authority. That is important so we don't 
need to build another Washington bureaucracy, and you can be assured of 
better help if you need it. Our State insurance commissioners are much 
closer to the real problems confronted by insurance consumers and are 
better able to deal with those issues at a local level. It is also not 
intended to affect association health plans created by other means than 
the pathway established in the final rule.
  There has been a lot of discussion in the Senate lately about 
protections for people with preexisting conditions. I support 
protecting people with preexisting conditions. Every Republican Senator 
I know does too. It is important to point out that robust coverage 
doesn't mean very much if you can't afford to buy it. Unfortunately, 
that has been the experience for a lot of small business owners and 
self-employed Americans in my State. Association health plans can help 
solve this problem for small businesses. The Labor Department's final 
rule didn't just expand eligibility for a type of health insurance that 
has long been available for some small business owners in the United 
States. It made the promise of comprehensive and affordable health 
insurance coverage a reality for the same Americans who have identified 
the cost of health insurance as the No. 1 problem facing small 
businesses for the last 30 years.
  This is not to say there is not more that can be done. The final rule 
is an important step forward, but it is not a silver bullet. There is 
more Congress can do to advance association health plans, and there is 
more Congress can do to improve our healthcare system and address the 
issues of rising healthcare costs and rising drug prices, all while 
ensuring protections for people with preexisting conditions, but one 
thing we can do immediately to help people with preexisting conditions 
is to pass the bill I am introducing today. The district court judge 
struck down the Labor Department's final

[[Page S2439]]

rule and did not issue a stay, so thousands of currently covered 
individuals are at risk of losing their health insurance coverage. 
Passing this bill will ensure that they do not.
  Small businesses ought to have the opportunity to band together and 
leverage their combined strength so they can negotiate and provide 
their employees with comprehensive and affordable health insurance 
coverage. That coverage should be subject to the same consumer 
protection requirements that apply to large employers offering similar 
coverage. Small businesses and their employees are the bedrock of our 
country's economy, and proper health insurance coverage is a key 
element of family well-being and peace of mind. This bill will 
strengthen those foundations so we can continue to prosper as a 
country.

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