Response to Judge Bates’ AHP Regulatory Ruling


As many of you know, there was a legal setback for association health plans. Judge Bates of the D.C. District Court sided with the democratic attorney generals who sought to block the new regulation opening up the association health plan market to more participants. Judge Bates’ ruling on the new Department of Labor regulation is not only disappointing from a perspective of legal interpretation but also represents clear harm to small businesses across the nation. Thousands of employees and family members within the small business community have already enrolled in association health plans – which help lower health care costs – since they first became available last fall. They have provided a means by which broad benefits may be accessed at more economical prices. While I do not believe today’s ruling will survive appeal, I believe Judge Bates’ decision is an unnecessary detour on small businesses’ path toward more affordable health coverage.”

It is important to note that while this lawsuit was filed before the new regulation was implemented, it did not stop insurers and employers from moving forward with these plans. Clearly, insurers, employers and chambers of commerce have confidence in this emerging market. plans to release a new study next week that analyzes the work that chambers of commerce have done in launching new association health plans. Chamber of commerce association health plans are regionally-based and one of the areas that the ruling targeted.

Today’s decision was issued by U.S. District Judge John Bates in State of New York v. U.S. Department of Labor. The Department of Labor regulation — which has staggered implementation dates, the last of which is April 1 of this year — made it easier for small employers to band together to offer more affordable health insurance plans previously available only to large companies.