Comment letter on AHP legislation (April 28, 2003)

April 28, 2003 The Honorable John A. Boehner Chairman, House Committee on Education and the Workforce 2181 Rayburn House Office Building Washington, DC 20515-6100 Dear Representative Boehner: 1This letter presents the comments of the American Academy of Actuaries’ Association Health Plan Work Group regarding the Small Business Health Fairness Act of 2003 (H.R. 660 and S. 545). As 2you know, these bills would amend ERISA to establish a new “Part 8—Rules Governing Association Health Plans.” H.R. 660 and S. 545 are designed to expand access to affordable health insurance by promoting the use of Association Health Plans (AHPs). We support efforts to increase the availability, affordability, and accessibility of health insurance. While the goals of the legislation are laudable, the bills do not address the core problem, which is the high cost of health care. As currently written, the bills will likely have unintended negative consequences that would hinder the intent of the legislation. Members of the American Academy of Actuaries are available to assist Congress in developing solutions to address the issue of small-employer health insurance reform. Executive Summary Some of the unintended negative consequences of the legislation and our related concerns are as follows: Unlevel Playing Field: The consequence of different rules for AHPs versus state-regulated insured plans is a fragmentation of the market resulting from an unlevel playing ...