House votes to repeal Affordable Care Act
Since the law originally passed in 2010, many Americans have been closely watching the changing political environment to see what changes happen with the Affordable Care Act (ACA or Obamacare). Employers are watching Washington with an invested interest to see what rules they will need to comply with and which rules might change.
The most recent midterm election resulted in a swing of control to the GOP. Clients are asking what impact this change might have on attempts to repeal the ACA. Regardless of the GOP’s dominance in Congress and in the House of Representatives, WGA believes that Obamacare is not going away anytime soon.
The GOP has been showing their opposition to Obamacare from the moment it was proposed in 2008. At that time, the GOP unanimously voted against the final version of the law but fell short when they were ultimately outvoted by the Democrats. During the recent midterm election of 2014, the Republicans won a 57% majority in the House of Representatives and approved a vote to repeal the ACA; the vote will now move to the Senate.
In conjunction with this repeal vote, the Republicans have issued a replacement outline to the ACA that proposes to remove the legal requirement that everyone must have healthcare. Instead they propose that all Americans have access to a health plan, pre-existing condition protection and shared coverage to children up to age 26. This may assist those who are dependent on the government to purchase private plans through tax credits. For those who do not qualify for government assistance, they may be eligible for financial help with this change. The states would be allowed the power of healthcare under the condition they follow Federal guidelines. More details about this are still being discussed within Congress. The GOP is hoping that the Supreme Court may help in their cause through the upcoming King v. Burwell case.
King v. Burwell challenges the ACA’s provision that authorizes tax credits for Health Insurance purchased through state exchanges. Thirty-six states chose not to establish their own exchanges and opted instead for a federally run marketplace. The IRS extended the tax credits for insurance purchased through these federally run exchanges. Since the ACA’s ‘plain language’ only refers to state run exchanges, King v. Burwell asserts that the IRS interpretation directly violates the law. The Supreme Court will decide whether the IRS’s interpretation may stand. If the Supreme Court votes against the IRS interpretation it will hinder the ACA goal of expanding health insurance coverage. Millions may lose their tax credits and will not be able to afford health coverage, which would allow the Republicans an opportunity to propose their own solution.
Regardless of the GOP’s dominance in Congress, it will take years for Republicans to complete the outlined proposal, then Congress has to vote on it. In the meantime, we encourage our clients to continue working on complying with the Affordable Care Act rules. More information can be found on the ACA and its rules can be found on WGA’s Heath Reform Advisory Corner webpage.
About the Author
Joanne Loutraris is a Senior Underwriting Specialist in the Employee Benefits Group at WGA. She specializes in assisting various WGA clients with analysis and interpretation of renewal experience, as well as, utilization data for all lines of coverage.