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BCBSA: Federal AHP Legislation Passed By House Would Result in Higher Premiums, More Uninsured and Increased Fraud

Posted on: Tuesday, 26 July 2005, 21:00 CDT

WASHINGTON, July 26 /U.S. Newswire/ -- Following is a statement from Mary Nell Lehnhard, senior vice president, Blue Cross and Blue Shield Association (BCBSA):

Today's passage by the House of Representatives of H.R. 525, "The Small Business Health Fairness Act of 2005," would be devastating to small businesses and their workers who are in desperate need of quality, affordable health coverage.

By exempting association health plans (AHPs) from state laws and consumer protections, the House-approved legislation would eliminate existing basic limits on how much and how often premiums can be increased, assurances that critical health services are covered, requirements on how much insurers have in the bank so that claims are paid, and extensive consumer protections such as the right to appeal to an independent panel when a claim is denied.

A new report from the Georgetown University Health Policy Institute reinforces the argument that this legislation is bad public policy. Mila Kofman's report entitled, "Association Health Plans: Loss of State Oversight Means Regulatory Vacuum and More Fraud," concludes that the federal AHP bill would have "the unintended consequence of widespread fraud threatening the coverage and financial security of millions."

The Georgetown paper adds to the already extensive body of research conducted over the past five years on this topic from sources like the Congressional Budget Office, Mercer Consulting, the California Healthcare Foundation and others, who have found that federal AHPs would increase premiums for most small employers and their workers, and make it much harder, if not impossible, for small business owners with older, sicker workers to gain access to affordable health coverage.

BCBSA and nearly 1,400 small business, healthcare provider, consumer and state government organizations - as well as individual governors, insurance commissioners and attorneys general - oppose federal AHPs.

BCBSA calls on the Senate to reject federal AHP legislation and, instead, pursue thoughtful and practical policies that improve access to affordable healthcare for small employers and their workers, and all Americans.

To view the Georgetown study on federal AHPs and healthcare fraud go to http://www.georgetown.edu/research/ihcrp/ahp.html. In addition, a compendium of recent AHP research can be found at http:/ /www.protectyourhealthcare.org.

The Blue Cross and Blue Shield Association is made up of 40 independent, locally owned and operated Blue Cross and Blue Shield companies that collectively provide healthcare coverage for more than 93 million - nearly one-in-three - Americans.

For more information about the Blue Cross and Blue Shield Association and the Blue Cross and Blue Shield companies, please visit http://www.BCBS.com. For more information on Blue Cross and Blue Shield Association's policy positions and the healthcare debate, visit http://www.BCBSHealthIssues.com.

http://www.usnewswire.com

Source: U.S. Newswire

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