Executive order speeds up 1si program launch, but plan is controversial nationally

Nov. 12--SOUTHERN INDIANA -- An executive order signed by President Donald Trump one month ago means that One Southern Indiana might be able to offer a previously planned health insurance program to its members sooner than originally thought. But the order has also shed light on the type of program 1si hopes to implement, which has been criticized in the past for the regulations it helps evade, but has also been praised for helping small businesses afford insurance for their employees.

1si's proposed health plan, which would be accessible by its 1,000-plus local business members, is an association health plan, or AHP.

Businesses or individuals form AHPs by banding together to offer insurance to their employees. Their increased numbers, which bring greater negotiating power and larger pools of people to spread out risk, allow them to lower their premiums, said Andrew Cassis, the local market president for AssuredPartners NL, an insurance brokerage firm with locations across the United States. AssuredPartners is helping 1si find an insurance carrier for its AHP.

But larger businesses seeking health plans aren't subject to some key regulations. Their plans don't have to cover the ten "essential health benefits," which include prescription coverage and maternity/newborn care. They also aren't subject to state benefit mandates, and they don't have to abide by the community rating rule, meaning that different employees within an association can be charged a different premium than everyone else based upon their health status.

Association Health Plans were more popular before the Affordable Care Act. In fact, One Southern Indiana offered one in conjunction with Greater Louisville, Inc., said Wendy Dant Chesser, the president and CEO of 1si.

But the Affordable Care Act mandated that each different employer in an AHP had to act in accordance with their size, making them subject to the regulations that large group markets aren't.

"It took away the pricing advantages," Cassis said -- essentially defeating the purpose of putting together an AHP at all.

One Southern Indiana dropped its plan.

Trump's executive order, signed on Oct. 12, seeks to bring back AHPs to where they were before. The order would allow small businesses to act as large ones after joining an AHP.

On Dec. 11, regulations to revise the current guidelines for AHPs will be proposed in Washington D.C.

It's not official, but Cassis hopes the regulations allow 1si to roll out its AHP by the third quarter of 2018. The chamber of commerce had previously planned to start an AHP, but the process has sped up since Trump signed his executive order.

Currently, many 1si employees feel as if they're priced out of the insurance market, Dant Chesser said. Under the Affordable Care Act, businesses with under 50 employees don't have to offer health insurance, and at a March press conference scheduled by 1si for its ancillary insurance program (which offers non-medical insurance such as life and disability insurance), local small business owners testified that they were unable to offer health insurance because of the high cost.

Even larger employers have told Dant Chesser that they'll have to pay 20 percent more each year to provide their employees with

"I think that our members, we would be providing our members a great service if we were to offer this type of program to them," she said.

One Southern Indiana's AHP will have several plan options, Cassis said, although he doesn't know how many just yet. Some of those options could lack essential health benefits, but Dant Chesser thinks employers in the local market will think carefully about the insurance plan they choose.

"Just from our standpoint, if we were to offer a bare minimum insurance program, we are going to upset several of our employees," she said.

Insurance benefits could also affect the quality of workers a business is able to attract, which is a significant issue in Southern Indiana where workers have many options for employment.

But fewer health benefits are a real concern, Dant Chesser said. She doesn't want to see members who already offer insurance programs choose ones with less coverage under 1si's AHP. She wants to help those who don't offer insurance currently or those who would like to upgrade, but can't afford it.

Other news reports have pointed out that AHPs have a history of mismanagement and failure, leaving their members with unpaid medical bills. One Southern Indiana's, however, will be managed by an A rated company, Cassis said.

Traci Wright, AssuredPartners NL's local director of client engagement, said, "You have to be careful. You have to have the right partner that understands this business, that's fair and reasonable and can handle the volatility of it."

Cassis has sent three established companies request for proposals for 1si's AHP. The chosen business will pay 1si's insurance claims, negotiate pricing and provide customer service, among other things.

AssuredPartners also helped 1si put together its ancillary insurance program. It was launched in March and offered organization members life, disability, vision, dental and pet insurance, as well as a section 125 Premium-Only-Plan.

So far, it's had the desired effect, Dant Chesser said. Businesses that didn't think they could provide insurance to their employees are now doing so for cheaper prices.

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