Judge blocks Trump’s small-business health insurance plan

WASHINGTON (AP) — A federal judge has struck down a small-business health insurance plan widely touted by President Donald Trump, the second setback in a week for the administration’s health care initiatives.

U.S. District Judge John D. Bates wrote in his opinion late Thursday that so-called “association health plans” were “clearly an end-run” around consumer protections required by the Obama-era Affordable Care Act.

On Wednesday, another federal judge blocked the Trump administration’s Medicaid work requirements for low-income people.

The plans at issue in Bates’ ruling Thursday allow groups of small businesses and sole proprietors to band together to offer lower-cost coverage that doesn’t have to include all the benefits required by the ACA, often called “Obamacare.” The plans also can be offered across state lines, an attempt to deliver on a major Trump campaign promise.

But Bates wrote that key parts of the Trump administration’s policy are “unlawful and must be set aside” because they go against established definitions of what constitutes an employer under a decades-old federal law that governs workplace health and pension benefits.

In particular, a decision by the administration that sole proprietors can be counted both as employers and employees “stretches the statute too far,” Bates wrote.

Trump has eagerly talked up the plans , claiming they’re doing record business and promising small business owners “you’re going to save massive amounts of money and have much better health care.” But the plans don’t seem to have had a major impact. The Labor Department regulation authorizing them only took effect last summer.

“There’s been a few of these that have been announced,” said Gary Claxton, an expert on employer health insurance with the nonpartisan Kaiser Family Foundation. “It hasn’t been in effect all that long.”