Employee Benefits Corporation sent three members of our Compliance team to the Employer Council on Flexible Compensation (ECFC) Annual Conference in Washington, D.C. March 8-10, 2017. The GOP released the American Health Care Act (AHCA) and fact sheet late on March 7th and up until the weekend directly preceding the release of the AHCA the bill included a cap on the employer exclusion on healthcare and a repeal of the Cadillac tax. Pushback from unions and employer advocates saw to it that the draft would evolve over the weekend; removing the cap on the employer exclusion on healthcare, and delaying the Cadillac tax instead of repealing it altogether.
The Ways and Means Committee began review of the bill on March 8th and concluded at 4:30 am on March 9th, finally voting this out of committee with a party line 23-16 vote.
The House Energy and Commerce Committee continued working, tackling a reshaping of Medicaid and advanced GOP legislation to repeal and replace ObamaCare on a party line vote Thursday afternoon, after 27 hours of continuous debate. The committee markup lasted from Wednesday morning to Thursday afternoon before it was finally approved, 31-23.
The House Budget Committee markup to consider the American Health Care Act has been rescheduled for Thursday, March 16, 2017 at 10:00 am in 1334 Longworth.
If the bill makes it out of the House Budget Committee it will go before the House for a vote. If it passes the House it will move onto the Senate.
The American Medical Association and AARP, the nation’s largest advocacy group for older people, are concerned about Medicaid and the projected increase to premium costs for older Americans. Some in the GOP party are concerned about the predicted number of Americans that will lose coverage.
While the future is not certain for the AHCA, it is important to keep in mind that compliance with the Affordable Care Act (ACA) will be required until provisions are repealed and replaced. Congress is using the budget reconciliation process to repeal many of the provisions that had an impact on the budget. It will take separate legislation to completely repeal all of the ACA requirements. The employer exclusion on health care may be revisited when Congress works on tax reform later this year. During the ECFC conference, the American Benefits Council reported that 178 million Americans rely on employer sponsored insurance. Retaining the employer exclusion on healthcare will be important to many of us who have our insurance through employer based plans.
What we do know is that the AHCA does not repeal the following:
- Dependent coverage until 26
- Pre-existing conditions policy
- Essential health benefits
- Prohibitions on annual and lifetime limits
As a result, in the short term, 6055 and 6056 employer reporting on offers of coverage and the Summary of Benefits and Coverage (SBC) will still be required regardless of what happens with the AHCA. The AHCA retains the prohibitions on annual and lifetime limits which also would continue the integration requirement for Health Reimbursement Arrangements (HRA) which means that you must be enrolled in an employer sponsored health plan in order to participate in an HRA. Further, there is nothing that expands the ability to reimburse individual health plan premiums from a HRA either, aside from the small employers that qualify under the Qualified Small Employer HRA (QSEHRA).
Employee Benefits Corporation along with other members of ECFC were on the Hill last week talking with members of Congress to advocate on behalf of employers who use consumer directed health care as a way to manage employee benefit cost as well offer cost saving measures to their employees who use Health Flexible Spending Accounts (FSA), Health Reimbursement Arrangements (HRA) and Health Savings Accounts (HSA) as a way to afford their care. We will continue to advocate for the repeal of the Cadillac tax (not just the delay) and the preservation of the employer exclusion on healthcare on behalf of our employer clients and the employees who participate in consumer directed accounts. We will continue to watch as this legislation evolves in Washington and will provide updates as they become available.