The momentary lull in congressional activity on health care provides an opportune time for an update on the efforts to repeal and replace the Affordable Care Act (ACA).
Following the House of Representatives’ approval of the American Health Care Act on May 4, 2017, the Senate Republican leadership introduced its own version, the Better Care Reconciliation Act—which was later followed by a “skinnier” version of the bill, the Health Care Freedom Act—but ultimately failed to obtain the 51 votes needed to secure adoption before commencing an unofficial recess on July 28.
While the final stretch at the Senate was intense—starting at dawn and lasting late into the night, with closed-door political intrigue—the repeal and replace efforts could not overcome three significant hurdles: the burdensome budget reconciliation process necessary to avoid a filibuster in the Senate; conflicting interests of fiscal conservatives and states with large Medicaid populations; and Congressional Budget Office projections that indicated the number of uninsured Americans would rise sharply under each of the proposals.
With ongoing calls from the White House for Senate Republicans to renew their repeal and replace efforts, and with modest suggestions of a more bipartisan approach, Congress is likely to revisit changes to the ACA in the fall. Since the July 28 defeat, other Republican Senators have begun working on new bills they hope to introduce when the Senate returns (e.g., the Graham-Cassidy proposal).
Changes to Health Savings Account requirements allowing funds to be used to pay health insurance premiums, and establishing state block grants in lieu of funding to expand Medicaid eligibility are among the reforms that have more uniform support among Republican representatives. If the subject of comprehensive tax reform moves ahead of health care on the Congressional docket, discussion of the elimination of ACA taxes (including the repeal or delay of the so-called “Cadillac tax”) may resurface.
Also, the spotlight may also start to shine on actions undertaken by the Trump administration. The Centers for Medicare and Medicaid Services has already advanced certain measures relating to the individual market. For example:
- Announcing a new program that will permit states to obtain waivers from certain ACA market-reform requirements in exchange for establishing high-risk reinsurance pools and other innovative programs addressing affordability of coverage; and
- Adopting a final rule that shortens the ACA Exchange open-enrollment period to November 1 through December 15, 2017—to more closely align it with Medicare—and takes other enrollment measures aimed to strengthen the individual health insurance market.
However, more pressing issues—such as the continued funding of cost-sharing reductions for low-income individuals—may signal the level of support that can be expected from the Trump administration toward maintaining key elements of the ACA.
To date, ACA rules on employers sponsoring group and individual health care coverage appear to have received little attention from regulators, and most of the requirements remain in place. (The only exception is an interim final rule that was leaked in May addressing exemptions from the mandated contraceptive coverage under the ACA’s preventive benefits provision.) This means, among other things, that the Summary of Benefits and Coverage Rule template, updated effective April 1, 2017, must be addressed by employer plans and, as of now, employer reporting obligations will continue in January 2018.
Under this administration, changes are imminent for the ACA and a range of other laws and regulations affecting health care and health benefits. Ballard Spahr attorneys established the Health Care Reform Initiative to monitor and analyze legislative and regulatory developments. We will continue to follow developments in this area as they emerge. Changes may come to the Health Care Reform Dashboard, but it will continue to serve as an online resource center for news and analysis on developments regarding the ACA and any reforms that follow.
Attorneys in Ballard Spahr’s Health Care and Employee Benefits and Executive Compensation Groups represent clients across the health care industry and counsel clients on health care, benefits and tax regulatory and compliance issues, as well as privacy and data security, transactional, financing, benefits and compensation, and labor and employment matters.