The U.S. House of Representatives Tuesday, in a 268-150 vote, passed a controversial bill that would exempt expatriate health plans, and employers that sponsor them, from the health care coverage requirements of the Affordable Care Act.

The Expatriate Health Coverage Clarification Act of 2014 (H.R. 4414) deems expatriate health coverage to be minimum essential coverage under an eligible employer-sponsored plan according to the Internal Revenue Code. The bill defines a qualified expatriate as a U.S. national, lawful permanent resident or nonimmigrant expected to work abroad for lengthy periods of time in connection with his or her job.

Backed by the Washington, D.C.-based American Benefits Council and National Association of Health Underwriters (NAHU), the bill is intended to level the playing field for insurers, allowing them to compete with foreign insurance companies that also sell expatriate health insurance plans, but are not required to comply with the ACA.

“This imbalance gives foreign competitors an unfair advantage,” Janet Trautwein, executive vice president and CEO of NAHU says in a letter of thanks to the bill’s sponsor, Rep. John Carney (D-Del.).

The House bill “narrowly clarifies that the Affordable Care Act does not apply to expatriate health insurance plans,” she adds.

Opponents of the bill say it would permit insurance companies to sell inferior insurance policies to American and foreign workers and their families who live in the United States, according to the House Committee on Energy and Commerce website. The bill is opposed by, among others, the United Farm Workers, the American Federation of Labor and Congress of Industrial Organizations (AFL-CIO), National Immigration Law Center.

Since the legislation’s original introduction in early April, it has been amended to require an expatriate plan at least meet minimum value requirements as defined under the ACA (60% actuarial value), Trautwein says.

“This is the same standard all other employer-provided plans must meet in order to comply with the laws employer shared responsibility provisions. Should an expatriate plan offered under this bill fail to meet minimum value requirements, an employee would be eligible to seek coverage on the exchange and could be eligible for income-based subsidies,” she adds.

The amended bill also “explicitly states that expatriate plans must continue to comply with relevant laws enacted prior to the ACA — specifically the Employee Retirement Income Security Act and the Public Health Service Act,” Trautwein says.

The bill also declares that a qualified expatriate (and any dependent) enrolled in an expatriate health plan should not be considered a U.S. health risk for purposes of assessing the annual fee on health insurance providers that provide health coverage to any U.S. health risk for any year after 2014.

It also establishes a special rule for calculating the amount of this fee for calendar 2014.

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