WASHINGTON (March 7, 2018) — A proposed rule from the U.S. Department of Labor could make it easier for small businesses and self-employed individuals to purchase health insurance through association health plans, or AHPs, according to the National Association of Realtors®.
In a comment letter submitted yesterday, NAR expressed mostly strong support for the proposed regulation, which modifies and broadens the definition of “employer” to include “working owners,” opens the door to potentially allowing trade associations, including NAR, to offer health insurance coverage to members through the large group insurance market. The large group insurance market typically offers greater flexibility in insurance plan design and lower policy costs through improved negotiating power.
While most Americans get their health coverage through an employer, most real estate agents, and nearly nine in 10 Realtors®, are independent contractors, not employees, of their real estate brokerage. As an independent contractor, many typically don’t have access to traditional employer-provided benefits, such as 401K plans and health insurance, since these types of benefits could jeopardize their independent contractor status. As a result, self-employed professionals are forced to purchase insurance in the individual insurance market, which tends to offer fewer choices at higher costs.
NAR’s 2017 Member Profile found that 46 percent of members paid for their health insurance out of pocket; 32 percent received it through a spouse, partner, or family member; 3 percent had employer-provided health insurance; and 20 percent didn’t have any health insurance at all.
“As health insurance costs continue to rise and the number of coverage options shrink, the need for affordable health care option remains a top concern for the nation’s 1.3 million Realtors®,” said NAR President Elizabeth Mendenhall, a sixth-generation Realtor® from Columbia, Missouri and CEO of RE/MAX Boone Realty. “Allowing working owners to participate in AHPs could expand access and provide more reasonably priced health insurance options for individuals and families.”
In the letter to regulators, NAR recommended changes to the proposed eligibility requirements to maximize participation among self-employed real estate professionals. NAR encouraged the Department of Labor to reconsider a provision preventing working owners from participating in an employer health plan if subsidized coverage is available to them through a spouse’s employer; however, that may not always be the most affordable option for a family.
“Eliminating this requirement will provide greater insurance choices to more real estate professionals, many of whom are struggling to find affordable insurance,” said Mendenhall. “We urge the administration and the Department of Labor to move forward with our recommendations in mind, and while challenges likely remain ahead that could delay its completion, we have strong hope that a final rule will be issued sometime in the near future and real estate professionals will have improved access to affordable health insurance.”
As next steps, DOL will be reviewing the hundreds of comments submitted and issue a final rule reflecting that feedback, likely later this year; that rule could then be used by insurers for plan design. However, the final rule may be subject to legal challenges that could delay implementation.
For more than a decade, NAR has advocated for reforms to the health insurance market to provide better coverage to real estate-related businesses and the self-employed, and NAR will continue to advocate and be closely following DOL’s progress and the potential benefits for real estate professionals across the country. Additional information on NAR’s health insurance advocacy efforts, please visit www.nar.realtor/health-care-reform.
The National Association of Realtors®, "The Voice for Real Estate," is America's largest trade association, representing 1.3 million members involved in all aspects of the residential and commercial real estate industries.