During testimony at two different U.S. House committee hearings, witnesses urged lawmakers to repeal certain provisions of the Patient Protection and Affordable Care Act (ACA) and modify others.
While there was at least one witness at each hearing stating that the ACA has in part controlled health care costs and has not had the adverse effect on labor as predicted, most testified that there is increased administration and some confusion caused by certain provisions, and expected future costs are feared by employers.
Speaking before the House Committee on the Education and the Workforce Subcommittee on Health, Employment, Labor, and Pensions, Tevi Troy, president of the American Health Policy Institute, adjunct fellow at Hudson Institute, former Deputy Secretary of the U.S. Department of Health and Human Services, and a former senior White House Domestic Policy Aide, urged a repeal of the excise tax on high-cost health plans that will go into effect in 2018. “Policymakers should recognize the cost of employer-provided care is increasing for a variety of reasons beyond the control of employers and employees, including the aging work force; new medical technologies and drug therapies; and new mandates, taxes, fees and compliance burdens imposed by the ACA,” Troy said.
Rutland “Skip” Paal Jr., testifying on behalf of the Society of American Florists, told the committee that the 30-hour definition of full-time employee places a burden on employers who usually employee a number of part-time workers. Lawmakers have already moved to have the definition changed to a 40-hours-a-week work requirement. In addition, complicated definitions of “seasonal worker” and “seasonal employee” make it hard for some employers to determine whether they are large or small employers under the ACA. Paal urged the lawmakers to pass a proposed bill that would align the definition of seasonal employee with that of the Treasury Department.
Sally Roberts, director of human resources (HR) at Morris Communications Company in Augusta, Georgia, speaking on behalf of the Society for Human Resource Management, noted that one approach employers are embracing to control health care costs is the implementation of incentive-based wellness programs. But, recent litigation pursued by the Equal Employment Opportunity Commission (EEOC), asserting that medical screenings to participate in wellness programs are not voluntary and therefore are in violation of the Americans with Disabilities Act (ADA) and the Genetic Information Nondiscrimination Act, has threatened the certainty of law for employers that offer these programs. Lawmakers have proposed a bill to clarify wellness program rules in the ACA.
According to Roberts, another challenge facing companies is the new employer reporting requirements under the ACA. She noted that large employers that self-fund their health care plans serve as both the insurer and the employer. Under these conditions, self-insured employers will be impacted by the new ACA reporting requirements on a larger scale than employers that are not self-insured. Self-insured employers will be responsible for reporting both as the insurer and the employer. In addition, exchange notification requirements for multi-state employers are a challenge.
Meanwhile, during a hearing about the individual and employer mandates in the ACA before the Committee on Ways and Means Subcommittee on Health, Douglas Holtz-Eakin, president of the American Action Forum, contended that financial incentives are embedded in the ACA that encourage employers to drop health benefits and shift workers onto the health insurance exchanges. “Virtually all employers and some low- and moderate-income employees would be financially better off for doing so,” he claimed. He urged lawmakers to repeal the employer mandate.
In a separate statement, American Benefits Council President James A. Klein said, “Like most five-year olds, ACA still needs direction. Congress should fix what isn’t working and help make the law more administrable.” Along with changes recommended by hearing witnesses, the Council recommended lawmakers permit employers to establish stand-alone health reimbursement arrangements—or similar accounts—that can be used to purchase individual coverage. Employers and employees could share financial responsibility for the account, providing another means to meet their respective ACA obligations.
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