Federal judge’s insurance ruling is big win for N.J., which joined other states in fight

By Anjalee Khemlani
New Jersey | Mar 30, 2019 at 10:26 am

A ruling by a federal judge to shut down association health plans — which allowed companies located in a contiguous area to set up self-funded plans — will have little impact on New Jersey’s insurance market, because the state has only two AHPs.

But, state officials said Friday, it is a big win for the state.

New Jersey was one of the 11 states that sued the federal government to halt the sale of AHPs last June.

New Jersey Commissioner of Banking and Insurance Marlene Caride said in a statement to ROI-NJ that the ruling is helping maintain the Affordable Care Act.

“The Trump administration’s Association Health Plan rule was part of its ongoing effort to dismantle the Affordable Care Act,” Caride said. “The court appropriately called the rule an ‘end-run around the ACA.’ New Jersey joined with its partner states in standing against this attack through the unlawful expansion of association health plans that fail to provide important protections that residents deserve.”

New Jersey’s laws have often been called as stringent, if not more, as the Affordable Care Act, which was cited by the judge as the reason AHPs were being pushed by President Donald Trump’s administration.

U.S. District Judge John Bates said as much in his 43-page ruling.

“The (AHP rule) is clearly an end-run around the ACA,” he wrote. “Indeed, as the president directed, and the secretary of labor confirmed, the (AHP rule) was designed to expand access to AHPs in order to avoid the most stringent requirements of the ACA.”

Caride said any insurer operating in the state must abide by state laws.

“Association health plans are subject to state regulation in New Jersey and must comply with strict standards. Notably, if they are covering small employers, their plans must provide benefits equal to plans sold in the small employer market,” she said.

Anjalee Khemlani | akhemlani@roi-nj.com | AnjKhem