4 ways the GOP could actually change Obamacare
With Republicans now in control of both houses of Congress, Senate GOP leader Mitch McConnell has publicly vowed to repeal the healthcare reform law at any cost. That’s not going to happen while President Obama has veto power — but there is a very real possibility the Affordable Care Act (ACA) could get a major facelift.
After all, the president himself has hinted at making some concessions regarding the controversial law.
One of the top changes those in the Benefits world expect to see: A return to the 40-hour per week threshold for defining full-time employees.
Under the current health reform regs, individuals who work at least 30 hours each week must be considered full-time equivalent (FTE) employees for ACA purposes.
In addition to this potential change, here are three additional changes we could see to the ACA, courtesy of Benefits Pro’s Allison Bell.
1. A repeal of the Cadillac tax
For businesses the Cadillac plan excise tax, which takes effect in January of 2018, is one of the most hated provisions in a law that has plenty of despised regs. In fact, employers have consistently listed the Cadillac tax as one of the most concerning Obamacare provisions since the law took effect back in 2010.
As HR pros know, the Cadillac plan reg imposes a 40% tax on the most expensive or “Cadillac” health plans. This will apply to individual health plans worth more than $10,200 and families health benefits valued at more than $27,000, starting in 2018.
Because this tax doesn’t kick in until 2018, Republicans may be able to get the next president to sign a repeal bill between 2016 and 2018. And Democratic supporters of Obamacare may be open to accepting such a repeal bill if it means getting Republicans to keep other key health reform provisions in place.
Another potential scenario Bell says employers should watch for: Opponents of the tax convincing the Internal Revenue Service (IRS) to delay its implementation.
2. Changes to the Medical Loss Ratio (MLR) formula
According to the ACA’s medical loss ratio regs, major medical carriers must spend at least 85% of large-group revenue and 80% of individual and small-group revenue directly on healthcare or quality improvement efforts.
The current MLR formula keeps insurers from including compensation for agents and brokers in medical care spending totals.
But critics have have pushing for years to get broker comp removed from the calculations altogether. Their argument: Consumers are the ones who actually pay brokers; insurers merely collect the payment to the brokers — and streamline the process for customers.
The bulk of the Republicans and many Democrats agree with this stance. Plus, certain state-based public exchanges have been drumming up support from agents and brokers. So you may see the GOP succeeding in making changes to this reg.
3. Required exchange performance reporting
Bell believes the small, less-costly tweaks to the current law will have the best shot at taking effect. One example to watch for: H.R. 3362, the Exchange Information Disclosure Act, a bill that was reintroduced in January and received some significant Democratic support, with Yes votes from Dems who rarely cross party lines.
Among other things, the bill would require the U.S. Department of Health and Human Services to publish weekly ACA exchange activity reports in a specified format.
This post originally ran on our sister site, HRBenefitsAlert.com.
