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Senator Edwards Prioritizes Small Businesses to Gain Bargaining Power with Healthcare Options for Employees

Small Business Healthcare Act passes the legislature with bipartisan support

Awaits Governor’s signature

RALEIGH, N.C. – In a bipartisan vote, the North Carolina Senate passed Senate Bill 86: Small Business Health Care Act – sponsored by Senators Joyce Krawiec (R-Forsyth), Dan Bishop (R-Mecklenburg), and Chuck Edwards (R-Henderson) – providing small businesses and sole proprietors with authorization to band together to form Association Health Plans (AHPs) to classify as one “large employer” to offer affordable and quality healthcare benefits for their employees.

“This critical legislation liberates small businesses from crushing costs to offer quality healthcare benefits to their employees. Small businesses complain shopping on the Affordable Care Act’s small group market drives their premiums sky-high, limits their bargaining power, and adds additional regulations,” said Senator Chuck Edwards. “This will allow small businesses to enjoy the same regulatory and financial advantages as large corporations when it comes to purchasing health insurance for their employees,” Edwards went on to say.

The Small Business Health Care Act is part of the legacy of the Affordable Care Act (ACA) that includes many state and federal consumer protections, including the requirement to cover those with preexisting conditions, and plans would also be required to meet specific solvency standards. By allowing small businesses pool together, their coverage will be cheaper but will be in line with existing laws governing large group plans.

A June 2018 ruling by the U.S. Department of Labor loosened Obama-era restrictions on AHPs that were designed to force more small businesses onto the costly small-group market. The Small Business Health Care Act takes advantage of the new limits and amends North Carolina’s insurance code by doing the following:

  • Allows an AHP to include businesses from either the same OR different industries;
  • Allows an AHP to include businesses from either the same OR different industries;
  • Allows an AHP to include sole proprietors, self-employed, and their families;
  • Allows an AHP to include members statewide and across state lines; and
  • Reduces the time that an AHP has to be in existence in North Carolina to offer health insurance from 5 years to 3.

The bill is supported by several North Carolina’s professional associations including the North Carolina Retail Merchants Association, the North Carolina Farm Bureau, the North Carolina Chamber of Commerce, the North Carolina REALTORS, and the North Carolina Restaurant and Lodging Association. It is estimated that these modifications to North Carolina’s insurance code could potentially benefit up to 110,000 North Carolinians.