The Trump Administration is on a mission to rescue health-care markets and consumers from ObamaCare’s shrinking choices and higher prices. Witness the Labor Department’s proposal to allow small businesses to band together to provide insurance on equal footing with corporations and unions.
The share of workers at small businesses with employer-sponsored health benefits has dropped by a quarter since 2010 as insurance costs have ballooned in part due to government mandates. About 11 million workers employed by small businesses are uninsured. Some businesses have dropped their workers onto state insurance exchanges where premiums are subsidized by taxpayers.
Enter President Trump, who last fall directed Labor Secretary Alexander Acosta to consider “expanding the conditions that satisfy the commonality-of-interest requirements” for association health plans under the Employee Retirement Income Security Act, or Erisa.
Large-group plans that are self-insured—i.e., funded by unions or employers—are covered by Erisa. These plans are exempt from ObamaCare’s essential benefits requirements, though they must comply with rules on annual and lifetime limits and pre-existing conditions as well as state solvency regulations.
Mom-and-pop businesses and sole proprietors aren’t so lucky. Most purchase coverage from insurers in the small group or individual marketplaces, which are subject to ObamaCare’s coverage mandates and controls on premium prices. The Obama Administration precluded small employers from forming association plans that are exempt from Erisa by narrowly interpreting the “commonality of interest” membership requirements.