It seems hard to keep up with all the changes being introduced, re-introduced, voted against, and voted for when it comes to the future of the Affordable Care Act (ACA). The latest measure includes a compromise plan that was proposed on July 31 by a bipartisan group of 40 House lawmakers called the Problem Solvers Caucus (yes, that is a thing) to address the problems with the ACA.
According to CCH/Wolters Kluwer, Rep. Daniel Lipinski, D-Ill. said in a July 31 press release that for past the seven years, he has advocated that the two parties come together to address problems in the ACA. "On the heels of the failure of the Republican effort to repeal the ACA, the Problem Solvers Caucus is taking the lead in doing just that," Lipinski said. "The commonsense, bipartisan plan we are putting forward will take the steps that everyone agrees are needed to stabilize the individual health insurance market and reduce premiums," he added.
The plan focuses on five provisions. The proposed changes to the ACA would be paid for by offsets within the health care system, according to Lipinski.
Among these changes, the plan proposes appropriating funds so that cost-sharing reduction payments continue to be made. Although the current method of funding these payments has been ruled unconstitutional by the federal district court of Washington, D.C., the proposal would ensure the payments continue.
Additionally, the plan would create a dedicated stability fund for states’ reinsurance programs for paying for high-cost enrollees, which is estimated would result in a 5-to-10 percent reduction in premiums. The plan also proposes keeping in place the employer mandate but would raise the threshold to businesses of 500 or more employees, and would repeal the medical device tax of 2.3 percent.
Below is a recap of the ACA repeal and replace journey that has taken place over the past 6 months:
On Wednesday, July 26, 2017, the U.S. Senate rejected a proposal from Republican lawmakers for a repeal-only measure. However, Republicans did narrowly pass a "motion to proceed" that allows the Senate to begin consideration of the repeal-and-replace plan (AHCA) that passed the House of Representatives in May. What happens next? Now the Senate will debate health care reform and begin voting on "amendments" to the House's bill. Bottom line: This will take some time. Nothing will be changed in the near future so employers should continue to plan on complying with ACA in its current form.
BACKGROUND: On Thursday July 13, 2017, the U.S. Senate released a revised draft of the Better Care Reconciliation Act. The revised bill adds a provision that would allow people to use health savings accounts to pay their premiums. It also adds an additional $70 billion toward covering out-of-pocket costs and another $45 billion toward battling the opioid epidemic. The proposed cuts to Medicaid remain largely intact. Some influential GOP senators have publically said they doubt it will be possible to get 50 of the Senate's 52 Republicans to back the bill. (Update: On July 17, 2017, this revised bill failed to garner enough support to move it forward).
On June 22, 2017, Senate Republicans released their 142-page ACA replacement, titled the "Better Care Reconciliation Act." The proposed legislation seeks to:
- Roll back taxes and penalties in the ACA,
- Repeal the individual mandate and the employer mandate,
- Limit Medicaid expansion,
- Give states more flexibility to opt out of some insurance requirements, and
- Eliminate Planned Parenthood from federal funding.
Key Takeaway for Employers
Until the new legislation is passed and the implementation date is upon us, employers must continue to comply with the ACA in its current form.
MRA will continually monitor the progress of the Better Care Reconciliation Act and provide updates on the MRA website in the News to Know section. As always, our HR Business Advisors are available to answer your questions, 24/7, at 866-HR-HOTLINE (866-474-6854), or email InfoNow@mranet.org.
UPDATE: On May 4, 2017, the House of Representatives passed the American Health Care Act, with a few alterations from the version previously proposed. The passed legislation now proposes:
- allowing states to let insurers charge more to individuals with preexisting medical conditions;
- allowing insurers to charge 30 percent higher premiums for one year to individuals who have a gap in coverage;
- allowing states to follow current ACA requirements to include a specific set of benefits in all health plans sold to individuals and small businesses, or create their own set of coverage requirements.
The Senate has created its own version of the American Health Care Act bill in response to the House bill. However, no details have been released and there is no specific timeline when a draft will be released or debated on the floor of the Senate. It is anticipated that more will be known before the July 4th Congressional Recess.
What this means for employers right now is that ACA in its current form still remains the law of the land and covered employers need to continue to comply with all aspects. MRA will continually monitor and provide updates on any new developments.
BACKGROUND: On March 6, 2017, House Republicans unveiled proposed legislation to replace the ACA. The American Health Care Act called for:
- freezing enrollment in the ACA's expanded Medicaid program on Jan. 1, 2020, and capping future Medicaid funding. Until the end of 2019, states would be able to sign individuals up for expanded Medicaid;
- replacing insurance subsidies with refundable tax credits to help people pay for health coverage;
- ending the penalty for failing to comply with the individual and employer mandates to buy insurance;
- preserving two popular ACA features:
• letting young adults stay on their parents' plans until age 26, and
• preventing insurers from dropping people with preexisting conditions.
Source: Michael Hyatt, HR Government Affairs Director, MRA – The Management Association