On 12 States’ Lawsuit Challenging DOL Rule Undermining Affordable Care Act

Following is a statement by Christine Owens, Executive Director, National Employment Law Project:

“Today, 12 states sued the Trump administration to overturn a Labor Department rule that aims to roll back the protections of the Affordable Care Act (ACA).

“As the complaint alleges, the rule seeks to accomplish this objective by permitting a broad range of associations to offer health plans that are largely unregulated and do not have to comply with various Affordable Care Act protections. The rule opens the floodgates to ‘fake’ health insurance, fueling the potential for a new era of widespread health insurance fraud and abuse. States would have to redirect significant enforcement resources to curb those abuses. The rule jeopardizes state efforts to protect their residents through stronger regulation.

“Before the ACA, small business owners who wanted health coverage for themselves and their employees sometimes turned to Association Health Plans (AHPs) that claimed to offer affordable coverage. Unfortunately, participants often found out, too late, that the coverage was illusory and medical bills were their responsibility to pay. After the ACA, small business owners had no need to resort to these suspect plans.

“The lawsuit filed today alleges that the Labor Department violated the Administrative Procedures Act, the ACA, and the Employment Retirement Income Security Act (ERISA), with the primary purpose of undermining the ACA. We applaud the effort of these states that are suing the Trump administration to protect health care for their citizens and to fight back against this attack.”

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