But Even if They Proceed, they are Already DOA.
As the employer community waits for the DC Circuit Court of Appeals to weigh in on State of New York v. U.S. Department of Labor (to decide the fate of the Trump Administration’s 2018 Association Health Plan Rule), business-minded critics of the Final Rule that the Administration is fighting to save would argue that even in victory, AHPs will fail to disrupt the delivery of health insurance to business owners because it fails to grant state pre-emption, thereby limiting the impact on true market disruption.
Health Insurance expert Kev Coleman’s research, conducted prior to the March 2019 invalidation of the rule, showed early trends of limited utilization, stark regionalization and lack of true economic differentiation. Win or lose, true health insurance disruption will not come from AHPs. Instead, disruptive models within the HRO space, innovative employer-sponsored solutions like ICHRA plans and technology driven AI and analytics are poised to deliver the disruptive solutions of the future.
The roll-out of Employer-Sponsored Individual Coverage HRAs (ICHRAs) in 2020 as an ACA-compliant employer option is a disruptor in waiting. While the 90-day employee notice requirement may slow their roll-out for groups with 1/1/20 plan years, make no mistake, a disruptive wave is afoot for sub-50 FTE employers. As a result, forward-looking PEO and HRO providers have the inside track to corner the early market in 2020 as a new client offering. The article below from SHRM does a nice job providing a general overview of what is coming.
Copyright © 2020 Fidelio Business Advisors LLC - All Rights Reserved.