Business as usual for industry as advisers await health reform action
As lawmakers continue to debate the American Health Care Act, the GOP plan to replace the Affordable Care Act, brokers are advising their clients to continue with business as usual.
A planned vote in the House on the AHCA did not take place Thursday, as House conservatives say they don’t have a deal yet with the Trump administration on a proposal designed to win Republican holdouts’ support for the party’s embattled healthcare bill.
The Trump administration made what it called a final offer to the group that includes repealing the so-called essential benefits requirements in the ACA for the individual market only, not for employer-based plans, according to a White House official who spoke on condition of anonymity.
So what does this mean for those in the benefits industry? Ed Olekisak, senior vice president of employee benefits and shareholder at brokerage Holmes Murphy in Dallas, says it means employers should continue business as usual. “As an employer, you need to keep focus on quality care, transparency and wellness,” he says.
The two parts of the AHCA that are most likely to impact employers — the expansion of HSAs and the elimination of the employer mandate — are not set in stone, as the bill is likely to be changed as it moves through Congress and then for signing by President Donald Trump.
As of now, the AHCA does not eliminate the ACA’s employer reporting requirements, despite dropping the employer mandate. If the employer exclusion is removed, agents will have to figure out if there will be coverage requirements for employees who work more than 30 hours and are not eligible for a subsidy, Olekisak explains.
“One of the options on the retail market is to drop the hour requirements for benefits,” he says. “Move it back up to 40 hours. We will have to wait and see how the regulations come out [and see] … what the rules are around who can qualify for a subsidy.
Additionally, Oleksiak says he does not know how the reporting requirements can fully go away since the AHCA has a penalty for not having coverage and the government will therefore need to know who is covered. “Hopefully [the administration] doesn’t create a whole new system … but tries to make simpler what we have today,” he says.
‘Don’t jump off any bridges yet’
Oleksiak says he’s telling clients not to panic about the possibility of changes. “Don’t jump off any bridges yet,” he says. “This thing is going to continue to change. It has to get through [Congress].”
Tonya Booth, vice president of employee benefits at Amarillo, Texas-based brokerage Upshaw Insurance Agency, is telling clients a similar story. “We are reinforcing that the [ACA] is still there,” she says.
“We are telling [clients] wait and see because we don’t know what the ultimate impact will be for them,” adds Sima Reid, founder and president of Long Beach, Calif.-based brokerage twentytwenty Insurance Services.
“There is really no reason to do something because [what would we do]?” she asks. “What is it [clients] will do without knowing what the changes will be going forward?”
Despite any provision in the law, employers are slow to change, Oleksiak explains. While the GOP has talked about expanding flexible spending accounts, employees have made their elections for 2017. “A lot of those things are going to be more long-term, then short-term planning,” he adds.
For clients, the bottom line is “stay informed and don’t panic,” Oleksiak says. “Until we have something concrete, we can’t deal with it.”
After a bill eventually passes Congress, there will be then new regulations from the Department of Health and Human Services. “We will have to comment on those,” Oleksiak says. “That … will be something we have to focus on.”
Additional reporting by Bloomberg News