FSI works to defend association health plans rule against court threat

Organization hopes to offer coverage to independent-contractor members

Jan 29, 2019 @ 2:02 pm

By Mark Schoeff Jr.

This time, the Financial Services Institute is siding with the Labor Department in a lawsuit.

The trade association, which represents independent broker-dealers and financial advisers, last month joined an amicus brief in a suit brought in a federal court in Washington, D.C., against a DOL rule that would allow trade associations to offer health plans to their members.

The suit, brought by several states and the District of Columbia, asserts that the plans would undermine the Affordable Care Act and hurt people with pre-existing conditions. The FSI and other groups argue that they would offer comprehensive group plans that would not undercut the federal health law.

"Even with the ACA in place, there is a huge need," Chris Paulitz, FSI senior vice president for membership and marketing, said Tuesday at the FSI OneVoice conference in New Orleans. "It's certainly something that our members have been desperate for for years."

FSI members working as independent contractors can be hit with stiff premiums and high deductibles for health-care coverage, Mr. Paulitz said.

The FSI membership comprises 100 firms and about 33,000 financial advisers. The organization concentrates on lobbying on legislative and regulatory policy, but health-care costs are becoming a big worry.

"Other than the DOL fiduciary rule, that's been the No. 1 issue we hear financial advisers have concerns about," David Bellaire, FSI executive vice president and general counsel, told reporters at the conference.

The FSI prides itself on playing a role in defeating the DOL fiduciary rule, which was vacated by a federal appeals court ruling last year in a lawsuit that included the group as a plaintiff.

But when it comes to the association health plan rule, the FSI is standing with the DOL. Mr. Paulitz anticipates a decision in the D.C. federal court in March or April.

The rule has not been stayed while it undergoes the court challenge. But insurance carriers are reluctant to write policies with legal uncertainty surrounding the measure.

The FSI offers disability insurance and group term life insurance to its members and their staffs. A health insurance component would be another membership benefit.

"It enhances the value of membership and gives them a deeper connection to our advocacy mission," said Dale Brown, FSI president and chief executive.

Last year, FSI attained record revenue of $10 million.

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