A new federal rule will make it easier in many states for unrelated small businesses to band together and buy large group health coverage through an association health plan (AHP). However, California law doesn’t allow the creation of new AHPs — and existing AHPs must have a “commonality of interest” beyond providing benefits to their employees. State regulations also prohibit California businesses and their employees from joining associations in other states.
For more guidance on California’s laws and regulations on association health plans, go to leginfo.legislature.ca.gov.
Because California law doesn’t allow the creation of new association health plans (AHPs), a new federal rule won’t impact AHP regulations in this state.