B2B Payments

Labor Department Releases New SMB Healthcare Rules

This week, The U.S. Department of Labor (DOL) released revised rules for small businesses (SMBs) on use of association health plans following an executive order by the White House.

Reports in CNN said President Donald Trump's efforts to reduce healthcare costs for some small businesses moved forward with the DOL's rules that enable SMBs and self-employed professionals to buy health insurance collectively. These professionals can group together based on industry or location, reports noted.

The rules, which allow association healthcare plans (AHPs) to be regulated the same way as large employer policies, are part of the Trump administration's efforts to dismantle the Affordable Care Act (ACA) and provide small businesses with alternatives to the program. According to CNN, the executive order could threaten some customer protections under ACA.

"Many of our laws, particularly Obamacare, make healthcare coverage more expensive for small businesses than large companies," said Labor Secretary Alexander Acosta when the rules were announced. "AHPs are about more choice, more access and more coverage."

Reports said the AHPs would be cheaper, but likely provide less coverage to employees. Opponents of the initiative argue that they also allow these associations to base employer rates on worker age, gender and industry, whereas the ACA prohibits healthcare insurance providers from basing premiums on these factors, critics say AHPs women are likely to pay more than men for insurance.

The AHPs would not allow premiums to be based on preexisting health conditions or on employee health status, however.

Analysis from Avalere Health predicted that an estimated 3.2 million employees currently enrolled in Obamacare could shift their coverage to new AHPs. That shift may lead insurers to raise rates by up to 3.5 percent in the individual market, and by to 0.5 percent on the small business exchange for Obamacare.

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NEW PYMNTS DATA: HOW WE SHOP – SEPTEMBER 2020 

The How We Shop Report, a PYMNTS collaboration with PayPal, aims to understand how consumers of all ages and incomes are shifting to shopping and paying online in the midst of the COVID-19 pandemic. Our research builds on a series of studies conducted since March, surveying more than 16,000 consumers on how their shopping habits and payments preferences are changing as the crisis continues. This report focuses on our latest survey of 2,163 respondents and examines how their increased appetite for online commerce and digital touchless methods, such as QR codes, contactless cards and digital wallets, is poised to shape the post-pandemic economy.

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