GOP Rep proposes legislation blocking Biden from rescinding Trump rule that expanded association health plans

The Trump administration policy allowed small businesses to band together to receive the bulk rate that bigger businesses can receive

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EXCLUSIVE: Rep. Tim Walberg, R-Mich., is introducing legislation that aims to combat the Department of Labor's decision to rescind the Trump administration rule that expanded association health plans (AHPs).

The legislation, obtained exclusively by FOX Business, seeks to block the Biden administration's plan to gut AHPs, which allow some employees to save up to 50% on health care costs, as small businesses cite health care costs as their top concern. Walberg's proposal will be introduced on Tuesday.

"President Biden has campaigned on lowering health care costs for hardworking Americans, but his regulatory agenda tells a far different story," Walberg told FOX Business. "Biden has sought to undo a Trump-era rule, which both lowers health care costs and expands health care options for working Americans and small businesses. This is yet another example of Biden saying one thing but doing the other at the expense of the American people."

The policy implemented by the Trump administration allowed small businesses to join together to receive the bulk rate that bigger businesses are awarded.

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Rep. Tim Walberg is introducing legislation that seeks to block the Department of Labor's move to rescind the Trump administration rule that expanded AHPs. (Getty Images)

"The Trump-era AHP rule levels the playing field for small businesses who are allowed to band together to get similar bulk rates that large corporations enjoy," Walberg said. "Sadly, the Biden administration continues their illogical commitment to undoing Trump’s successful policies.  I’m proud to continue to lead the fight in Congress against Biden’s attempt to drive up health care costs and limit options for hardworking Americans."

The legislation's cosponsors include GOP Reps. Virginia Foxx, N.C.; Neal Dunn, Fla.; Aaron Bean, Fla.; Russ Fulcher, Idaho; Dan Meuser, Penn.; Troy Balderson, Ohio; Claudia Tenney, N.Y.; and Dan Crenshaw, Texas.

The Department of Labor announced in April it would rescind the 2018 rule that expanded the availability of AHPs, which it says "do not need to comply with several critical consumer protections" under the Affordable Care Act (ACA).

The Trump administration rule, which was largely invalidated by a court in 2019, made it easier for a group or association of employers to be treated as the "employer" when offering multiple-employer group health insurance, according to the Labor Department's announcement, which also said the rule effectively allowed more employers to offer health insurance coverage that "evades several critical ACA consumer protections."

Under Walberg's legislation, Congress would disapprove of the rule submitted by the Department of Labor "relating to Definition of 'Employer' — Association Health Plans," noting that the department's rule would "have no force or effect."

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The legislation seeks to block the Biden administration's plan to gut AHPs. (ALEX EDELMAN/AFP via Getty Images / Getty Images)

Last year, Walberg introduced the Association Health Plans Act that sought to expand health care options and lower costs for small businesses through AHPs. The House passed Walberg's Association Health Plans Act as a part of H.R. 3799, also known as the CHOICE Arrangement Act, in June 2023, but it has not yet been brought to the floor for a vote in the Senate.

The Biden administration last year criticized the Association Health Plans Act, which attempted to codify the Trump administration rule, as an "attack on the Affordable Care Act and its critical health care protections," describing the legislation as "the latest in a long line of attacks on Americans' ability to access the health care they need."

In December, following news of the Department of Labor's decision to rescind the Trump administration rule that expanded AHPs, Rep. Foxx, who chairs the Education and the Workforce Committee, said the rule would gut choice and exacerbate health care costs for small businesses and workers.

"Small businesses overwhelmingly cite the soaring costs of health insurance as their top concern," she said at the time. "In fact, since 2010, the share of small businesses with fewer than 50 employees offering health coverage has dropped from 39 to 32% — threatening a slow death spiral for the small group market and leaving workers and their families with fewer health care options. Instead of doubling down on heavy-handed government-intrusion tactics, the administration should pursue opportunities to increase health care choice and flexibility for workers."

The Trump administration policy allowed small businesses to band together to receive the bulk rate larger businesses can receive. (Getty Images)

In February, Foxx said the Biden administration "continues to double down on policies that will limit choice and increase health care costs for Americans."

"Instead of embracing common-sense policies that would allow small businesses to band together to offer coverage for their employees, the administration is rescinding a Trump-era rule which allowed for just that," she said at the time. "Today, Americans are shouting from the rooftops about how politicians need to increase health care affordability and tackle inflation. The administration’s proposed rule turns a blind eye to the needs of Americans."

Under the Trump administration's rule, new AHPs produced savings of up to 29% on average while it was in effect. Additionally, realtor groups saw average savings of up to 50%.