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According to the Atlanta Business Chronicle, a handful of Atlanta executives and politicians are lobbying for legislation to allow small businesses in different states to pool together to save money on health insurance.
Health Insurance is legislated on a state level, so creating a federal program to form "association health plans" poses some challenges.
"If they're exempt from state regulation, there is no way on God's green earth that the federal government can check these organizations for solvency, and that's one of the main functions of state insurance departments," said Kirkland McGhee, executive director of the Georgia Association of Health Plans. "Multiple Employer Welfare Arrangements in the 1980s were like that and they stole money from people ... and companies like Blue Cross Blue Shield and Aetna had to pick up the mess that those people left. I'm afraid AHPs are like the second coming of that."
Insurance industry experts also believe that AHPs may lead to adverse selection for the existing insurance companies.
Charlie Harman, spokesperson for Blue Cross and Blue Shield of Georgia Inc., said it would upset the balance of healthy and unhealthy that a typical insurance company covers.
"More healthy people who may not see themselves going to the hospitals and needing the state-mandated benefits will select the [associated health plans] and Blue Cross Blue Shield will be left with the less healthy people, who will have higher claims and higher costs," Harman said.
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