24 May 2017
As you may know we are working with Almega Life Solutions to work toward offering a Group Health Insurance offering. While we work toward that offering we wanted to keep you up to date on some of the Federal laws coming down the pipe. The blow information is a re-post from a legislative update service we subscribe to.
House passes GOP health care bill
Six weeks after pulling the American Health Care Act (AHCA) (H.R. 1628) from consideration, the House of Representatives passed the bill on May 4, 2017, by a vote of 217 to 213. The revised bill, which alters certain provisions of the Patient Protection and Affordable Care Act (ACA) (P.L. 111-148), includes three amendments, which the Congressional Budget Office (CBO) has not yet scored. The first amendment is from Rep. Tom MacArthur (R- NJ), allowing states to waive essential health benefits (EHBs), age rating, and community rating. The second, from Reps. Gary Palmer (R- Ala) and David Schweikert (R- Ariz), would create a risk-sharing program for states. The third amendment, credited with bringing the bill back to the floor after its initial withdrawal, came from Reps. Fred Upton (R- Mich) and Billy Long (R- Mo), increasing the Patient and State Stability Fund by $8 billion over five years for states that use the MacArthur amendment’s waivers.
Although the AHCA is often referred to as a bill to repeal and replace the ACA, it would not do either; rather, the bill would eliminate many of the ACA’s tax provisions. The House also passed H.R. 2192, which would eliminate provisions that exempt members of Congress and congressional staff from state waiver provisions, in response to criticisms that the AHCA would affect all Americans except those voting on the bill.
Cadillac tax is delayed. Originally, the excise tax on high cost employer-sponsored health coverage was to apply to taxable periods beginning after December 31, 2019. Under the AHCA, the tax would not apply for any taxable period beginning after December 31, 2019, and before January 1, 2025. The tax would apply only for taxable periods beginning after December 31, 2024, effective on enactment.
Repeal of over-the-counter medicine tax. The definition of qualified medical care would be changed for purposes of the exclusions for reimbursements for medical care under employer-provided accident and health plans (including health flexible spending accounts (FSAs) and health reimbursement arrangement (HRAs)) and for distributions from health savings accounts (HSAs) or Archer medical savings accounts (MSAs) used for qualified medical expenses to include over-the-counter medicine that is not prescribed by a physician. Amounts paid from a health FSA or HRA, or funds distributed from an HSA or an Archer MSA, to reimburse a taxpayer for over-the-counter medicine, such as nonprescription aspirin, allergy medicine, antacids, or pain relievers, will be excluded from income in accordance with the general rules associated with those health-related savings and reimbursement vehicles. The provision would be effective (1) in the case of HSAs and MSAs, amounts paid with respect to taxable years beginning after December 31, 2017, and (2) in the case of health FSAs and HRAs, expenses incurred with respect to taxable years beginning after December 31, 2017.
More HSA provisions. The additional tax on HSA distributions not used for qualified medical expenses would be 10% of the distributed amount, and the additional tax on Archer MSA distributions not used for qualified medical expenses would be 15% of the distributed amount, is effective for distributions made after December 31, 2017.
The basic limit on aggregate HSA contributions for a year would be increased to equal the maximum on the sum of the annual deductible and out-of-pocket expenses permitted under a high deductible health plan, which are, for 2017, $6,550 in the case of self-only coverage and $13,100 in the case of family coverage. As under present law, basic contribution limits are increased by $1,000 for an eligible individual who has attained age 55 by the end of the taxable year. In addition, as under present law, the annual HSA contribution limit for an individual is generally the sum of the limits determined separately for each month (that is, 1/12 of the limit for the year, including the catch-up limit, if applicable), based on the individual’s status and health plan coverage as of the first day of the month effective for taxable years beginning after December 31, 2017.
If both spouses of a married couple are eligible for catch-up contributions and either has family coverage, the annual contribution limit that can be divided between them would included catch-up contribution amounts of both spouses. For example, the spouses could agree that their combined basic and catchup contribution amounts are allocated to one spouse to be contributed to that spouse’s HSA. In other cases, as under present law, a spouse’s catch-up contribution amount would not be eligible for division between the spouses. The catch-up contribution must be made to the HSA of that spouse, for taxable years beginning after December 31, 2017.
Repeal of FSA contribution limits. Currently, in order for a health FSA to be a qualified benefit under a cafeteria plan, an employee’s salary reduction contributions cannot exceed a dollar limit ($2,600 for 2017). This limitation on health FSA salary reduction contributions would be repealed, effective to taxable years beginning after December 31, 2017.
Employer and individual mandates. The AHCA would effectively eliminate both the employer and individual mandates to maintain health coverage. While not actually repealed, the amounts of the assessable penalties under the employer mandate have been reduced from $2,000 for not offering minimum essential coverage to full-time employees and their dependents and from $3,000 for offering coverage that is unaffordable or does not provide minimum value, to zero. The provision would be retroactively effective to months beginning after December 31, 2015.
The amount of the tax for failure to maintain minimum essential coverage has also been changed to zero. This provision would be retroactively effective to months beginning after December 31, 2015.
Changes to small employer credits. The provision repeals the small employer health insurance credit, effective for taxable years beginning after December 31, 2019. In the meantime, the small employer health insurance credit would not be available with respect to a qualified health plan that includes coverage for abortions, other than an abortion necessary to save the life of the mother or an abortion with respect to a pregnancy that is the result of an act of rape or incest. For this purpose, the treatment of any infection, injury, disease, or disorder that has been caused by or exacerbated by the performance of an abortion is not considered an abortion. The provision disallowing the credit with respect to a qualified health plan that provides coverage with respect to abortions is effective for taxable years beginning after December 31, 2017.
Budgetary considerations. When the CBO previously scored the bill—not updated to account for the latest amendments—it found that federal deficits would be reduced but 24 million individuals would lose health insurance coverage. The MacArthur amendment would allow states to waive the ACA’s prohibitions on charging individuals with pre-existing conditions more for health insurance coverage, while the Upton–Long amendment would provide some funding to help individuals in those states to pay for likely increases in premiums and out-of-pocket costs. However, doubts were raised about whether $8 billion would be sufficient; in 2013, Upton signed a letter to President Barack Obama saying that the $5 billion the ACA designated for the Pre-Existing Condition Insurance Plan (PCIP) was insufficient, and suggesting that $25 billion would have been a more appropriate figure. When asked, Upton said, “Is it enough money? I don’t know. That’s the question that I asked and was led to believe that $5 billion would be enough, which is why it’s $8 billion.”
Following the vote, House Republicans joined President Donald Trump at the White House for a Rose Garden press conference. Vice President Mike Pence congratulated the representatives on what he called “a historic first step to repeal and replace Obamacare,” while Trump expressed his confidence that the bill will succeed and promised, “premiums will be coming down; deductibles will be coming down.” The bill now moves to the Senate, where only a bare majority is needed to get through the reconciliation process. Some Senate Republicans have expressed reservations about the bill, however, and the Senate is reportedly planning to come up with its own version.
Preeclampsia screening must now be covered by group health plans
The U.S. Preventive Services Task Force (Task Force) has published a final recommendation statement and evidence summary on screening for preeclampsia. The Task Force recommends screening pregnant women for preeclampsia with blood pressure measurements throughout pregnancy. This is a B recommendation, and, as such, non-grandfathered group health plans may not impose any cost-sharing requirements (such as a copayment, coinsurance, or a deductible) and must provide coverage with respect to preeclampsia screening (ERISA Reg. §2590.715-2713(a)(1)).
Preeclampsia is associated with high blood pressure in pregnant women after 20 weeks of pregnancy. It is one of the most serious health problems affecting pregnant women and is a leading cause of preterm delivery and low birth weight in the U.S.
This final recommendation applies to pregnant women without a current diagnosis of preeclampsia and with no signs or symptoms of preeclampsia or hypertension. It updates the 1996 final recommendation and is consistent with the 2016 draft recommendation.
This recommendation statement can be viewed on the Task Force Web site at: www.uspreventiveservicestaskforce.org. A draft version of the recommendation statement was available for public comment from September 27 to October 24, 2016. The Task Force is an independent, volunteer panel of national experts in prevention and evidence-based medicine that makes evidence-based recommendations about clinical preventive services such as screenings, counseling services, and preventive medications on behalf of the American people.
SOURCE: U.S. Preventive Services Task Force press release, April 25, 2017.