What’s Next for Health Care Repeal Efforts?

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Employers want to know what's happening with health care reform and the promises that President Donald Trump made during his campaign to repeal and replace the Obama-era Affordable Care Act (ACA).

"It's a confusing time for all of us," said Beth Baerman, product communications director for Attendance on Demand—an attendance and time-keeping solutions provider.

Speaking at the SHRM 2017 Annual Conference & Exposition, Baerman discussed what is likely to change as well as what is likely to remain the same with new health care reform bills making their way through Congress.

Trump's Executive Order

True to his word, Trump signed an ACA-related executive order after his inauguration, she said. The order has some teeth—it gave federal agencies the discretion to waive or delay provisions of the ACA that pose fiscal, regulatory or tax burdens on stakeholders, she noted.

The stakeholder list is very long and specific: It mentions individuals, families, states, health care providers, patients, recipients of health care services, purchasers of health insurance and medical-product makers.

Employers, however, are absent from the list. Maybe employers fall into the "purchasers of health insurance" category, but this has created some confusion for employers as to whether the order applies to them, Baerman said.

Republican Bills

The Republican-sponsored American Health Care Act (AHCA) narrowly passed the U.S. House of Representatives in May—but the House bill is only the first step toward changing existing law.

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Some Senate Republicans oppose key parts of the House bill, Baerman noted. A group of 13 GOP senators took it upon themselves as a working group to write the Senate's bill, but they are doing so in secret, she said, adding that many Republican senators outside of the group don't even know what they plan to propose.

There have only been a few leaks to the press about the measure. Baerman said the biggest news broke recently when two congressional aides leaked to The Washington Post that they expect a bill to be released to Senate Republicans as early as this week, with a vote to take place on the measure as early as next week. [UPDATE: On June 22, the Senate made public the Better Care Reconciliation Act (BCRA)]

"But even if we see activity on this over the next few weeks, it will be a while before there's a final outcome," she noted, because the Senate and the House will likely go back and forth with modifications.

ACA vs. AHCA

Baerman identified several areas that are likely to change under Republican-sponsored health care reform:

  • Mandated penalties

The Republicans will take a different approach to health care coverage. Rather than mandating what individuals do, they are aiming to encourage individual choice through incentives and penalties.

For example, if individuals lose or drop their insurance for 63 days or more, then when they reinsure, they will have to pay more—insurers will be able to charge up to a 30-percent premium surcharge for a year after the lapse in coverage. The penalty payment would go to the insurer, not the government, Baerman noted. "The idea is that if you let your coverage lapse and sign up again later, it is probably because you are sick and now you are going to need it. So, insurers will be able to charge more even if the surcharge isn't officially for a pre-existing condition."

  • Tax credits 

The biggest change between the ACA and AHCA proposals would involve tax credits, Baerman said. First, the AHCA would end the existing law's tax credit for small businesses that offer insurance to their employees. It would also phase out income-based premium tax credits. Individuals would still be required to purchase insurance but wouldn't have to do so through state-based marketplaces.

Instead, Republicans have proposed age-based premium tax credits—which is controversial and may change, Baerman noted. She said the Senate might propose more generous tax credits or income eligibility thresholds than the House did.

  • Reporting

The good news for employers is that the Republican proposals are moving away from employer mandates. That means most of the employer reporting requirements will likely go away.

There will still be tax credits that individuals can receive if they aren't getting insurance through their employer, so employers will need to report certain things, Baerman said, but reporting will likely be simplified.


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