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Missouri Lowers Requirement for Association Health Plans

The number of companies needed to form an association will drop from 100 to 50.
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In an effort to provide more health-care options for small businesses, a new law in Missouri will lower the number of members required to join association health plans.

Under the law, signed by Gov. Matt Blunt on Friday, the membership requirement for association health plans will drop from 100 companies to 50. The plans, hailed by supporters as a solution for skyrocketing health-care costs, allow employers to band together and purchase coverage in bulk.

"This legislation gives our small businesses, which represent the largest and fastest-growing segment of our economy, access to the same purchasing power larger companies already enjoy," Blunt said in statement.

In addition, the legislation also waives a requirement that rates for similar small businesses be within 20% of one another.

The legislation, sponsored by Rep. Jay Wasson (R-Nixa), is modeled after a pilot project that took place last July and involved the Southwest Area Manufacturers Association's I Health Care Consortium.

Six out of the 32 companies in the consortium had never been able to afford group health care for their employees before the project, but once instilled, the companies saw initial premium savings of as much as 40% for small employers.

"Not only did this project expand access to health care, but the businesses also saw their costs go down," said Jessica Robinson, the governor's press secretary. "That result really paved the way for this legislation."

Robinson noted that association health plans were already available under existing law, but the new law simplifies the process.

"We hope that it will pass on a federal level that will cross state lines and make competitiveness in the insurance market greater," said Kathy Peerson, grass-roots coordinator for Missouri's chapter of the National Federation for Independent Business. "This gives small businesses one more option to shop for."

The Missouri bill will take effect on Aug. 28.




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