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August 2005
by James C. Musser, ASBA Washington Representative

Just before leaving town for the Summer District Work Period, the House of Representatives passed important legislation to help provide small businesses access to more affordable health care. The House, by a vote of 262-165, approved legislation to create Association Health Plans. The bill was favorably reported on April 13, 2005 from the Committee on Education and Workforce, which has jurisdiction over legislation regarding workforce protection and employer-employee relations.

The Small Business Health Fairness Act, also known as H.R. 525, was introduced on February 2, 2005 by Congressman Sam Johnson (R-TX3), a member of the powerful Committee on Ways and Means which has jurisdiction over much of the federal health care legislation. Mr. Johnson chairs the Subcommittee on Employer-Employee Relations on the Education and Workforce Committee.

Mr. Johnson said, "It is time to increase the (number of those) insured and give small business the same access to affordable health care that big business already enjoys. As I like to say, 'If it is good enough for Wall Street, it is good enough for Main Street.'" The bill was endorsed by a broad range of business organizations such as the U.S. Chamber of Commerce, the National Restaurant Association, the American Farm Bureau Federation, the National Association of Women Business Owners and the American Small Businesses Association.

Congressman Johnson, a long-time champion of small business and an AHP supporter, gathered 135 cosponsors for his bill including Small Business Committee Chairman Don Manzullo (R-IL16). Speaking in support of the bill Chairman Manzullo stated, "Our entrepreneurs, whose ingenuity and hard work have driven the American economy, have run out of options to battle this crisis (of rising health care costs). They need our help and Association Health Plans are a great option that will help control these runaway costs for our small business owners so they can focus on building their businesses and creating jobs."

The Small Business Health Fairness Act, if enacted by the Senate and signed by the President, would create national Association Health Plans (AHPs) which would allow small businesses to band together to purchase health insurance at group rates through national associations. AHPs would allow many of the estimated 45 million uninsured Americans to get affordable health coverage. Under the terms of the Johnson bill, only associations existing for at least three years for some purpose other than offering AHPs would be allowed to provide AHPs. The Department of Labor, which oversees corporate health plans, would monitor and regulate AHPS to protect consumers.

H.R. 525 has been sent to the Senate where it awaits consideration. The bill joins its Senate companion S.406 introduced by Small Business Committee Chairwoman Olympia Snowe (R-ME). Senator Snowe introduced her AHP legislation on February 16, 2005. The Snowe bill has been read twice by the Senate and referred to the Senate Committee on Health, Education, Labor and Pensions. The HELP Committee held hearings on the Snowe bill in late April.

President Bush has repeatedly called on Congress to pass AHP legislation and made it a major health initiative during his reelection campaign. The President has indicated that he will sign AHP legislation into law as soon as he receives it from Congress.

James C. Musser, Esq. is a legislative consultant based in Falls Church, Virginia. His reports are updated monthly.