House can Help Small Businesses by Rejecting Association Health Plans, Extending Premium Tax Credits

“If the U.S. House of Representatives is serious about making healthcare more affordable for small businesses, it should reject a proposed expansion of association health plans. Although association health plans may lower healthcare costs for the small businesses that choose to enroll in them, these plans are not required to offer many of the consumer safeguards and coverage options that plans regulated under the Affordable Care Act (ACA) are required to comply with. This includes essential health benefits like maternity care, mental health services and prescription drug coverage. Since association health plans are not required to comply with ACA standards, these plans are able to offer lower premium costs with skimpy benefits, attracting businesses with younger, healthier employees while leaving older employees with higher costs in the regular ACA-compliant market. While these plans may on the surface seem more advantageous economically, small businesses and their employees often end up paying much more out of pocket to cover their basic healthcare needs when compared to coverage under the ACA. 

Instead of hoping that association health plans would somehow fix the growing healthcare affordability crisis, Congress should instead renew the expiring enhanced premium tax credits (EPTCs). The EPTCs, which lower monthly premiums for health insurance plans purchased through the ACA Marketplace, have proven highly effective at reducing healthcare costs for many small businesses and their employees who constitute more than half of marketplace participants. In 2025 alone, more than 4.4 million out of 5.2 million small business owners and self-employed entrepreneurs enrolled in coverage through the Marketplace had their premiums reduced thanks to the enhanced premium tax credit. Without the EPTCs, however, KFF estimates that ACA marketplace enrollees would pay up to 114% more on average for their monthly healthcare premiums. It’s no wonder that Small Business Majority’s research found 74% of small business owners support extending the tax credits.

Congress has spent months arguing about how to make healthcare more affordable for small businesses. The solution in this case, however, is really very simple: Policymakers can help small businesses immediately by extending the EPTCs before they expire at the end of this month. No debate, compromise or even creative thinking are needed to do the best thing and the right thing when it comes to making healthcare more affordable for America’s small firms.”