If at first you don’t succeed…try, try again (AND AGAIN)

Congressional Republicans have voted to repeal the health care law 56 times

On Thursday, the Senate passed legislation repealing the core pillars of the Affordable Care Act (ACA), marking the first time such a bill has reached the president’s desk.  The measure attempts to gut the law by eliminating the individual and employer mandates, the medical device tax and the so-called “Cadillac” tax.  The Senate version also includes a delay of Medicaid expansion and exchange subsidies until 2018, among other things.

Republicans wrapped the measure in a special budgetary, filibuster-proof process (known as reconciliation) that required just 51 votes for Senate passage, circumventing the 60-vote hurdle usually required for controversial bills.  Ironically, Democrats used the same obscure budget procedure to pass the ACA back in 2009.

Not surprisingly, the White House has already promised a veto, saying the bill would “take away critical benefits and health care coverage” from families.

A significant — if only symbolic — victory

During the vigorous debate on the reconciliation bill, Senators adopted an amendment sponsored by Sen. Dean Heller (R-NV) to repeal the so-called “Cadillac” tax on high cost health plans by a vote of 90-10…providing momentum to the campaign being championed by companies across the nation in an effort to protect middle class workers who could see their benefit accounts scaled back or eliminated.

Created by the ACA, the Cadillac Tax is intended to discourage employers from offering health insurance plans with excessively rich benefits. Upon implementation in 2018, it will be equal to 40 percent of the value of any coverage in excess of $10,200 for an individual and $27,500 for a family. To determine whether these cost thresholds are exceeded, an overly broad net has been cast – one that includes many employer sponsored and consumer directed arrangements.  In particular, the statute is being interpreted such that employer and employee contributions to FSAs, employer contributions to HRAs, and employer and employee pre-tax contributions to HSAs are subject to the calculation. .

As the largest privately-held third party administrator in the United States, TASC – along with the Employers Council on Flexible Compensation (ECFC) – is leading the charge to lobby Congress in hopes of repealing the excise tax.  And while continuing to advocate for a full repeal, we recognize that achieving that goal by years end is unlikely given the various political realities, funding issues and time constraints.  Therefore, TASC believes Congress should enact legislation that would carve-out employee contributions to FSAs and HSAs, thus ensuring that they are not counted toward the calculation of whether an employer maintains high cost health coverage.

The simple reality is that these contributions are the employees’ own money and including them will harm the very people the ACA was trying to help.  Exempting employee contributions from the tax is an immediate step that will go a long way towards ensuring that American families will continue to be able to access important health benefits.

TASC will continue to keep you informed on this very important issue.

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