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House Passes Small Business Health Fairness Act

Takes action to empower families, small businesses with more affordable health care options

The House of Representatives today passed the Small Business Health Fairness Act (H.R. 1101), legislation that would expand health care coverage and lower costs for working families. Introduced by Rep. Sam Johnson (R-TX), chairman of the Ways and Means Subcommittee on Social Security, and Rep. Tim Walberg (R-MI), chairman of the Education and the Workforce Subcommittee on Health, Employment, Labor, and Pensions, the legislation empowers small businesses to band together though association health plans (AHPs) and negotiate for lower health insurance costs on behalf of their employees. The bill passed by a vote of 236 to 175.

“As someone who owned and ran a small business between my time in the Air Force and serving in Congress, I understand the challenges other small business owners face,” Rep. Johnson said. “For years, I’ve fought for AHPs to level the playing field so that these job creators can offer their employees more health care options at better costs. When Obamacare hit and small businesses suffered, AHPs became even more important. In fact, this bill is a central part of the effort to replace this bad law with commonsense solutions that help American families. I thank Chairman Walberg for his strong support of this effort, and I look forward to seeing our bill signed into law.  Better access to affordable health care is something all Americans want, need, and deserve.”

“Providing more health care options for small businesses is essential to expanding affordable coverage for America’s workers,” Rep. Walberg said. “When it comes to accessing high-quality health care coverage, small businesses should not be treated any differently than large corporations and unions. This bill will level the playing field for small businesses, and it’s one step toward achieving a competitive health care marketplace that stretches across state lines. These are exactly the types of positive reforms that we’ve promised — reforms that will deliver more choices and lower health care costs for working families. I’d like to thank my colleague Representative Johnson for championing this important legislation for years, and I look forward to continuing our efforts to provide the American people a better way on health care.”

“The House has taken an important step forward in our efforts to replace Obamacare with positive solutions that put working families first,” Chairwoman Virginia Foxx (R-NC) said. “These commonsense reforms will empower small businesses to purchase high-quality health care coverage at a lower cost for their employees — including across state lines. This is a win for the hardworking Americans who are struggling with soaring costs and deserve more affordable health care options. An important part of our three-phase plan to repeal and replace Obamacare, this vote reflects our commitment to delivering free-market, patient-centered reforms. I’d like to thank my colleagues Representative Johnson and Representative Walberg for leading this effort on behalf of our nation’s workers and small businesses.”

BACKGROUND: Due to their size and economies of scale, large businesses and labor organizations have the ability to negotiate on behalf of employees for high-quality health care at more affordable costs. By offering a qualified group health plan under the Employee Retirement Income Security Act (ERISA), these large employers and labor organizations are also exempt from myriad state rules and regulations on health insurance.

Small businesses, however, do not have the same bargaining power as larger businesses. Small businesses are also unable to band together to increase their bargaining power in the health insurance marketplace. By allowing small businesses to join together through association health plans (AHPs), small businesses can have greater ability to negotiate for lower health care costs for their employees.

Part of a broader effort to replace Obamacare with patient-centered solutions, Chairmen Johnson and Walberg introduced the Small Business Health Fairness Act. The legislation would empower small businesses to join together through AHPs to offer health insurance for their employees at a lower cost. Through these reforms, H.R. 1101 will:

  • Increase small businesses’ bargaining power with insurance providers and put them on a more level playing field with larger companies and unions.
  • Expand affordable coverage for working families who want to purchase health insurance through their employer.
  • Lower administrative costs for small businesses that face limited resources and want to provide health insurance to their employees.
  • Provide important protections to ensure plans are sustainable and individuals can count on their health care coverage when they need it.
  • Allow small businesses in different states to join together through a group health plan — a step toward purchasing insurance across state lines.

The read the bill, click here.

To read a fact sheet on the bill, click here.

To read letters of support, click here.

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