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Walberg, Johnson Introduce Legislation to Expand Health Care Coverage, Lower Costs for Small Businesses

February 16, 2017
Press Release

WASHINGTON, D.C. – 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, today introduced the Small Business Health Fairness Act (H.R. 1101). Part of a step-by-step process to replace the failed health care law with patient-centered solutions, the legislation would empower small businesses to join together through association health plans (AHPs) to provide their employees greater access to affordable health care.

Chairmen Johnson and Walberg released the following statements upon introduction:

"Due to Obamacare, fewer and fewer American small businesses are offering health care coverage, and that's a problem for American families," Chairman Johnson said. "Everyone knows that large employers are able to provide more affordable health benefits for their employees. That's because they have strength in numbers and don't have to adhere to costly rules and regulations that small businesses do. But this isn't right. Small mom and pop businesses on Main Street shouldn't be treated like second class citizens when it comes to being able to offer health insurance. Bottom-line: if it's good enough for Wall Street, it's good enough for Main Street. This bill would allow small businesses to band together for that same strength in numbers and free them from unfair regulations. It is one good step toward fixing our broken health care system, and I thank Representative Walberg for his support in this effort. Americans want, need, and deserve quality, affordable health care — and you can rest assured this remains one of my top priorities."

"We are taking an important step toward providing a better way to access quality, affordable health care," Chairman Walberg said. "By allowing small businesses to band together through association health plans, we can lower health care costs for working families. Obamacare not only failed to achieve this important goal, it made our nation's health care challenges even worse. This bill is part of a step-by-step process to deliver commonsense health care reforms that put working families first. Representative Johnson has been leading this important effort for many years, and I look forward to working together to advance these reforms."

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 who face limited resources and want to provide health insurance to their employees.

For a copy of H.R. 1101, click here.

To read a fact sheet, click here.