After surviving two Supreme Court cases and numerous repeal efforts, the Affordable Care Act (“ACA”) is in jeopardy again. Despite the law’s uncertainty, employers may want to continue their compliance efforts because: (1) the ACA is currently the law and there are significant penalties for noncompliance; and (2) for the reasons stated below complete repeal is anything but certain.
First, we do not know whether the law will be repealed outright. Although Republicans control Congress, they do not have a supermajority in the Senate. This means that, unless current filibuster law changes, Democratic Senators could block a bill to repeal the ACA entirely.
Second, to the extent that Congress attempts to repeal the ACA through the budget reconciliation process, which would only require a simple majority in the Senate, and could not be blocked by a filibuster, Congress would be limited to repealing those provisions that affect spending, revenues, and/or the debt limit. Notably, this would mean that the insurance market reforms (e.g., coverage of children up to age 26, the elimination of preexisting condition exclusions, and the prohibition on annual and lifetime limits) would survive. This would be somewhat consistent with Mr. Trump’s comments in his November 13th interview for CBS’s “60 Minutes,” in which he indicated that he would want to keep some of the ACA’s provisions – specifically the prohibition on preexisting condition exclusions and the ability to cover children up to age 26.
Third, while a Trump administration could stop enforcing the ACA entirely, that would not make sense if he truly wants to maintain parts of the law. Instead he could stop further implementation (e.g., rules implementing the already delayed and unfavorable Cadillac Tax). Most of the law as it relates to group health plans has been implemented and if the President-elect intends to keep parts of it, he may be hesitant to stop enforcement efforts.
Because we do not have a crystal ball to predict what parts of the ACA will go and what parts will stay, employers may wish to continue their compliance and to monitor events as they start to unfold in 2017.
To focus their efforts, employers may wish to see our SW Benefits Update, 2016 End of Year Plan Sponsor “To Do” List Health & Welfare.