Association health plans designed for small businesses have garnered recent support from President Donald Trump, but these plans have also had problems with fraud and abuse, according to The New York Times.
The president signed an executive order Oct. 12 to ease restrictions on association health plans, short-term insurance coverage and health reimbursement agreements.
The executive order outlines three main regulatory aims: allow more employers to form association health plans, expand the maximum length of short-term health insurance coverage and increase the usability of HRAs and employers' ability to offer HRAs.
However, fraud and abuse problems with association health plans are documented through litigation as well as federal and state enforcement actions taken over more than 10 years, according to the report.
For instance, The New York Times cites comments from the Labor Department, which states in many cases it has focused on "unscrupulous promoters who sell the promise of inexpensive health benefit insurance, but default on their obligations."
"In several cases, it has found that people managing these health plans diverted premiums to their personal use," the report states.
But The New York Times notes properly operated association health plans "can provide a legitimate option to small employers seeking affordable coverage."
President Trump signed the executive order the same day he announced his administration will end cost-sharing reduction payments — which help insurers selling plans on the ACA exchanges to subsidize the cost of coverage for low-income Americans.
Both of the president's actions Oct. 12 come as Republican lawmakers have made various unsuccessful efforts to replace the ACA.
Read the full report here. Read more about President Trump's executive order here.
Editor's note: Emily Rappleye and Leo Vartorella contributed to this story.