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Enzi-Nelson Small Business Health Plan
Archived October 22, 2009

Archived Key Issue

Sen. Enzi (R-WY), chair of the Senate HELP Committee, along with Senator Ben Nelson (D-NE) introduced S. 1955 – a bill to create Small Business Health Plans and harmonize state regulation of health insurance.

As introduced, S. 1955 would preempt state benefit, provider, and service mandates and state rating rules – establishing federal standards based on a “harmonization” of current state laws. It would also create a commission (led by NAIC) to “harmonize” all health insurance regulation, which must be adopted by the states. When S. 1955 was introduced, the NAIC was asked to be part of a “stakeholders” group that would include several proponents of Association Health Plan legislation and insurance company representatives to modify S. 1955.

The NAIC won support for several key amendments to the original draft, including: 1) no class certification of associations by the Dept of Labor (a process that would have allowed associations to begin operations without proper review); 2) a requirement that insurers be licensed in every state in which the association plan operates (thus preserving state consumer protections and state oversight); 3) no preemption of state access rules or consumer protections; 4) no creation of a mandated benefits list by the federal government; 5) no suing of non-adopting states for monetary damages; and, 6) no preemption of state individual or large group market rating rules.

On March 7, 2005, the NAIC leadership sent a letter to Chairman Enzi and Senator Nelson highlighting the improvements to the bill, but expressing strong concerns about provisions that preempt state small group rating rules. These provisions are “untenable” and “will do unintended harm.”


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