Mercer Talks Legislative and Regulatory Changes

In its latest Washington Update webcast, Mercer experts weighed in on legislative and regulatory developments for the Setting Every Community Up for Retirement Enhancement (SECURE) Act, health benefits and other regulatory and legislative topics.

The SECURE Act, a bipartisan bill that would significantly shift retirement planning and increase savings efforts, was passed in the House in May on a 417-3 vote. However, it has stalled in the Senate since, due to doubts from several Republican senators related to policy concerns.

Since it’s not likely for the bill to pass the Senate at the moment, Mercer’s Geoff Manville, principal, government relations, expressed that followers of the bill will tend to pin the Act on another piece of legislation before year’s end.

“The most likely path forward here is for senate supporters of the bill to try to tack the SECURE Act on to some other moving legislation this fall,” he observed. “Supporters of the bill are still guardedly optimistic that will happen.”

Meanwhile, efforts to address the multiemployer pension plan crisis is a focus on Capitol Hill. Manville points out that while there are no plans to receive traction in the Republican-dominated Senate, policymakers from the Right are working with Democrats on securing a solution. For example, he says, the House recently passed a bill centered on creating a federal loan program for large and underfunded plans.

Updates on health care reform

While there has been no immediate effect related to the Affordable Care Act (ACA), there have been a number of regulations issued related to an executive order from President Donald Trump, according to Mercer experts. Most recently, the administration has released an order on pricing transparency, requiring hospitals to post standard charge information; directing health care providers, health insurance issuers and self-insured group health plans to provide expected out-of-pocket costs for items or services before patients receive care; and more.

Regulators also added 14 new services, items and prescription drugs for chronic conditions that health savings account (HSA)-qualifying health deductible health plans (HDHPs) can offer as preventive care.

In accordance to the 2017 health care executive order, regulators have issued final regulations offering two new types of health reimbursement accounts (HRAs), beginning on or after January 1, 2020. The first option, says Cheryl Hughes, principal, Law & Policy Group, Mercer, is HRA integrative with individual market insurance or Medicare.

“There are a number of rules that go with this HRA. For the individual market HRAs, the employer can’t offer a choice between the individual coverage HRA and the traditional employer-sponsored group health plan, it’s one or the other,” explains Hughes.

Additionally, employers must make the HRA available on the same terms and conditions to all employees within the same class. As for maximum dollar amounts, each can vary but will be dependent on a participant’s age or family size.  

There’s also a new excepted benefit HRA. For this type of HRA it must be offered along with a traditional major medical group health plan, but an employee doesn’t actually have to enroll in the health plan, it just has to be offered to them. The HRA must be offered to all similarly situated employees, and it has an $1,800 annual limit. It can reimburse Section 213 (d) medical expenses and some premiums, including COBRA, excepted benefits, and short-term limited duration insurance, but not individual or group coverage.