A long-running lawsuit challenging what it means to be an employee and therefore have access to work-based health plans is being closely watched by health policy analysts.
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it → run → analysts
Its outcome could spur the availability of lower-cost but potentially skimpier health coverage that skirts some consumer protections.
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that → spur → protections
Court papers indicate a settlement in the case against the Department of Labor may be in the works, although the parameters of any such deal are unknown.
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parameters → indicate → deal
It would come amid been sharply focused on expanding access to alternative coverage, such as short-term plans that avoid ACA rules on preexisting conditions and benefit requirements.
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that → come → conditions
on Affordable Care Act marketplaces that have led millions to drop coverage this year.
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that → lead → coverage
The Trump administration has also"Depending on what happens with the settlement, this could be an even bigger expansion," said Katie Keith, director of the Center for Health Policy and the Law at the Georgetown University Law Center.
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Keith → happen → Center
"People are worried that it is the opening salvo into promoting junk plans that don't meet the ACA requirements."
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that → worry → requirements
The plaintiff, Data Marketing Partnership, filed its case against the Department of Labor in 2019, during the first Trump administration.
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plaintiff → file → administration
It wants official recognition as an employer so it can continue to allow its limited partners to buy into a type of job-based health insurance that doesn't have to comply with state insurance rules or offer coverage as robust as required under the ACA.
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that → want → ACA
But to grasp the claim, one also has to understand how the coverage works.
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coverage → grasp → claim
A consumer shopping for health insurance may come across information online or from a marketer about this concept, sometimes called "limited partnership" coverage.
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consumer → shop → concept
To qualify, the consumer must download an app that tracks their internet searches.
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that → qualify → searches
The company could then sell that data.
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company → sell → data
Some potential consumers may be turned off by the thought of their internet searches being tracked, but others may find it appealing because it allows them to become a limited partner eligible to buy into the company's employee health insurance plans.
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them → turn → plans
But can these partners be considered employees?
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partners → consider → ?
The court's answer has potential implications for regulators and consumers.
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answer → have → regulators
Some health policy and market experts warn that a green light could lead to a proliferation of aggressively marketed and potentially questionable insurance with limited recourse for consumers because the plans would be exempt from state oversight.
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plans → warn → oversight
"If this took off, you logically could see the rise of a whole bunch of what, functionally, would be unregulated insurance companies," said Ali Khawar, who was the principal deputy assistant secretary of the Department of Labor's Employee Benefits Security Administration during Joe Biden's presidency and now runs his own consulting outfit.
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who → take → outfit
No one knows if the department is going to change its long-running stance defending the case.
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department → know → case
But any settlement could add more uncertainty to insurance markets.
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settlement → add → markets
Already insurers are requesting double-digit increases in ACA premiums again next year, partly because declining enrollment often means that the healthiest policyholders are leaving.
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policyholders → request → premiums
That trend could accelerate in coming years as more people are drawn into alternatives such as limited-partnership policies.
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people → accelerate → policies
States act as federal case plays out
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case → act → ?
The Department of Labor defended the case throughout the first Trump administration and the Biden era, issuing a sharply worded advisory opinion in early 2020 stating that people who simply download software to "capture data as they browse the Internet" are not "employees or bona fide partners."
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they → defend → Internet
A district court judge in Texas, who had previously ruled the ACA unconstitutional in a decision ultimately rejected by the Supreme Court, called the advisory opinion "arbitrary and capricious" in a 2020 ruling in favor of the data marketer.
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who → rule → marketer
The U.S. Court of Appeals for the 5th Circuit largely upheld the lower court's decision but ordered it to reconsider whether someone who downloads software is either a "working owner" or a "bona fide partner."
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who → uphold → software
The employer-employee relationship is at the heart of the case because of a 1974 federal law designed to help large, self-insured employers offer retirement and health benefits to workers without having to meet varying rules from multiple states.
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employers → design → states
That law — the Employee Retirement Income Security Act — allows such plans to avoid most rules set by the states, which generally regulate most other types of insurance and assist consumers who report problems with their policies.
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who → allow → policies
As self-insured employer plans, the policies also don't have to comply with some ACA rules, such as the requirement to cover 10 broad categories of "essential health benefits.
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policies → insure → benefits
"
"If the case goes the wrong way, it could impact consumers or hamstring the states," said Marie Grant, Maryland's insurance commissioner.
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Grant → go → states
Arguments over what constitutes an employer plan are not new, and other organizations have tried offering such coverage.
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organizations → constitute → coverage
Some states have taken action against purveyors of limited-partner policies.
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states → take → policies
Maryland in 2024 fined a company, The Vitamin Patch, for offering limited-partnership insurance after investigating complaints and determining it was not licensed to sell coverage in the state.
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it → fin → state
Washington in 2021 ordered another company to stop offering its plans in the state and fined it $25,000.
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Washington → order → 25,000
Maine and Connecticut in 2024 warned consumers about this type of coverage.
"These plans do not provide comprehensive medical coverage and can leave consumers with large, unpaid medical bills," according to Connecticut's notice.
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plans → warn → notice
Maine's announcement noted that entities offering these types of health insurance included The Vitamin Patch as well as Affiliated Workers Alliance, Consumer Data Partners, Employers Business Alliance, Socios Buenos, and Strategic Limited Partners.
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entities → note → Patch
State insurance commissioners filed legal arguments in the Department of Labor case citing their concerns about losing the ability to enforce consumer protections.
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commissioners → file → protections
"This is not a Republican-Democrat thing," Khawar said.
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Khawar → say → ?
"It's really a story about state authority, the way such authority would be significantly undermined in insurance markets.
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authority → undermine → markets
Still, these limited-partnership plans are viewed by proponents as a needed additional choice for consumers, at potentially lower cost than ACA plans.
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plans → view → plans
…and 15 more, not listed.
The Aporia
