NY AG Schneiderman And MA AG Healey Lead Coalition Of 17 AGs Opposing Trump Administration's Attempt To Undermine The Affordable Care Act

News from Attorney General Eric T. Schneiderman

FOR IMMEDIATE RELEASE
March 7, 2018

Attorney General’s Press Office / 212-416-8060
nyag.pressoffice@ag.ny.gov
Twitter: @AGSchneiderman 

Proposed Rule Seeks to Expand Health Plans That Have a Long History of Fraud, Mismanagement, and Abuse – Part of an Effort to Evade Consumer Protections and Sabotage the ACA

Projections Show Millions of Enrollees Losing ACA Protections, Increased Premiums for Consumers Remaining in ACA Market, if Proposed Rule is Finalized

New York Attorney General Eric T. Schneiderman and Massachusetts Attorney General Maura Healey, leading a coalition of 17 Attorneys General, filed comments opposing the Trump Department of Labor’s Proposed Rule, which seeks to expand the criteria for forming association health plans (AHPs) in order to evade the consumers protections enshrined in the Affordable Care Act (ACA) and sabotage the ACA. AHPs have a long history of fraud, mismanagement, and abuse, with millions in unpaid claims for policyholders and providers, often leading to consumer bankruptcies.  

“The Trump administration’s rule is nothing more than an unlawful end run around the consumer protections enshrined in the Affordable Care Act, part of President Trump’s continued efforts to sabotage the ACA,” said Attorney General Schneiderman. “These so-called association health plans have a long history of fraud and abuse – leaving consumers holding the bag when an unforeseen medical issue arises. We won’t stand by as the Trump administration seeks to gut the most basic protections for consumers in a dangerous, partisan effort to undermine our health care system.”

Click here to read the comments, which were submitted by the Attorneys General of New York, Massachusetts, California, Connecticut, Delaware, District of Columbia, Hawaii, Iowa, Illinois, Maryland, Maine, New Jersey, New Mexico, Oregon, Pennsylvania, Virginia, and Vermont.

President Trump himself cited the sabotage of the ACA as the clear purpose of the Proposed Rule, stating while signing the order that he was “taking crucial steps towards saving the American people from the nightmare of Obamacare,” and tweeting the following day that “ObamaCare is a broken mess. Piece by piece we will now begin the process of giving America the great HealthCare it deserves!” 

Over the last few decades, Congress has legislated – including through the ACA – to protect health care consumers from AHPs’ fraudulent conduct. The Proposed Rule would undo critical consumer protections and unduly expand access to AHPs without sufficient justification or consideration of the consequences. 

The Attorneys General caution that projections forecast that the Proposed Rule, if finalized, would lead to several million enrollees shifting out of the ACA’s individual and small group markets into AHPs with far fewer health benefits and that the Proposed Rule would increase premiums for those remaining in the individual ACA market. 

State Attorneys General have extensive experience protecting individuals and small employers from predatory entities that seek to defraud or deceive customers through the use of AHPs. They seek that the Proposed Rule is unlawful and would invite fraud and wrongdoing in the health insurance market that will threaten the health and financial security of consumers nationwide.

The Proposed Rule reverses decades of agency and judicial interpretation of ERISA’s key terms, with the primary purpose of undermining the ACA  Because the DOL’s proposed changes would increase the risk of fraud and harm to consumers, undermine the current small-group and individual health insurance markets, and are also inconsistent with the text of ERISA and the ACA, the Attorneys General are urging that the Proposed Rule be withdrawn.