California is pushing back against the Trump Administration’s final rule allowing Association Health Plans (AHPs). Described as a type of Multiple Employer Welfare Arrangement (MEWA), the Administration is promoting these plans as a path for groups of businesses or organizations to obtain health insurance coverage. California Insurance Commissioner Dave Jones says that California law prohibits the formation of any new MEWAS. Jones notes that the final rule recognizes continued state regulation of MEWAS. “Some MEWAS have had a troubling history in California, including cases of MEWA fiscal insolvency, inability to pay consumer claims, and allegations of fraud,” Jones said.
Two bills have been introduced to block the federal Administration’s actions in California, according to the California Hospital Association. Senate Bill 1375 (Hernandez, D-Azusa) has been introduced to ensure self-employed individuals cannot proclaim themselves as “employees” for the sole purpose of joining Association Health Plans. The bill aims to maintain a stable, competitive individual market, to keep Covered California premiums low. In addition, Senate Bill 910 (Hernandez, D-Azusa) would prohibit short-term insurance health plans from being sold in California. The bill passed out of the Assembly Health Committee.
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