Health Care Reform Implementation Update - February 14, 2014

more+
less-

This week the Obama administration announced that it would delay the employer mandate, which requires that businesses with more than 50 full-time employees provide full-time employees with health insurance or pay a penalty, for some businesses until 2015, marking the second time the mandate has been delayed.  The House and Senate passed a measure to raise the country’s debt limit, averting the Treasury Department’s projected February 27 deadline.  Though House Republicans had considered attaching a 9-month sustainable growth rate patch (“doc fix”) to the bill, it was ultimately passed with no attached conditions.  Also, Senator Ron Wydenwas confirmed as the new Senate Finance Chairman, a position that will put him at the helm of one of the most important health policy committees in Congress.

ON THE HILL

On February 12, Senator Ron Wyden (D-Oregon) was confirmed to lead the Senate Finance Committee, taking over the chairmanship from the new ambassador to China, Max Baucus.  The Senate Finance Committee is one of the primary committees with jurisdiction over healthcare issues.

The House Ways and Means Committee advanced legislation that would change the workweek under the ACAfrom 30 hours to 40 hours.  Currently the ACA requires employers (with more than 50 employees) to provide health insurance to all full-time employees, where an employee qualifies as full-time by working 30 hours a week.  Republicans in the House and some Democrats are working to change the definition of full-time under the ACA to 40 hours a week.  This initiative is in part inspired by the significant number of employer cutbacks in employer hours to just under 30.  While a requirement that employees who work 40 hours be provided health insurance by their employers may result in similar hour reductions, hour reductions to just under 40 allow employees to work more hours than hour reductions to just under 30.  Further, a 40-hour definition fits what many believe is a more traditional full-time workweek.  This week, Rep. Dan Lipinski (D-Illinois) signed on to a Republican-led bill sponsored by Rep. Todd Young (R-Indiana), which would increase the number of hours an employee has to work to be eligible for health benefits from his or her employee from 30 to 40 hours.

The House and Senate passed legislation on February 12 to undo prior cuts to military pensions and pay for the change by extending sequestration for another year, which results in significant cuts to Medicare providers in 2024 and raises concerns among Medicare providers that sequestration-level reimbursement will eventually become the new norm.

The Medicare Payment Advisory Commission (MedPAC), the independent body that advises Congress on issues affecting the Medicare program, is next scheduled to meet in March.  We will provide further information on the agenda as it becomes available.

The Medicaid and CHIP Payment and Access Commission (MACPAC), the non-partisan federal agency charged with providing policy and data analysis to the Congress on Medicaid and CHIP, is next scheduled to meet on February 20.  We will provide further information on the agenda as it becomes available.

AT THE AGENCIES

On February 10, the Treasury department announced that it would delay the ACA’s employer mandate until 2016 for businesses with between 50 and 99 employees. Additionally, employers are not permitted to cut their workers to meet the threshold. This provision of the ACA was already delayed once from January 2014 to January of 2015.  Employers with 50 or fewer employees will not have to provide insurance to their employees, as was already the case.  Additionally, the regulation gives businesses with more than 100 workers additional time to prepare to provide coverage for their employees.  House and Senate Republicans responded to the additional time given to employers before they must comply with the mandates or face a penalty by renewing calls for the same treatment for the individual mandate.  Several Senate Republicans are also reaching out to the Internal Revenue Service requesting further information on how the individual mandate and its penalties will be enforced.

The regulations also detail some specific ways the employer mandate will affect school employees, saying that they may not be considered part-time (and thus an employee who does not require health insurance under theACA’s employer mandate, which only applies to full-time employees), even though schools are closed for part of the year.

Parts of HealthCare.gov will be down over President’s Day weekend for maintenance.  The deadline to sign up for coverage for March, however, is this Saturday.  In light of the upcoming deadline, the Obama administration announced a special enrollment period for people who have difficulty applying for March 1 coverage.  From 3pmSaturday through 5am Tuesday, customers will be able to access HealthCare.gov, even though they will not be able to verify their identities by the Social Security Administration.

The Department of Health and Human Services announced that about 1.1 million people signed up for health insurance through the ACA exchanges in January, bringing the total enrollment through exchanges to 3.3 million.  The administration says that 25 percent of the enrolled population is made up of the “young invincibles” it is hoping to attract, the population between 18 and 34 years old who are likely to be healthier and less expensive to the system.

On February 7, CMS announced that providers would have an extra month to demonstrate that they meet requirements for meaningful use of electronic health records.  The deadline, originally February 28, has been extended to March 31.

IN THE STATES

New York's state health agency said over 412,000 people in the state had enrolled in ACA since open enrollment began in October.  Two-thirds of these enrollees were previously uninsured.

New York Gov. Andrew Cuomo announced that New York and HHS had reached an “agreement in principle” on an $8 billion Medicaid waiver to help struggling hospitals throughout the state that otherwise would have closed, particularly those in Brooklyn.  New York had requested a $10 billion waiver.

CMS is giving the Massachusetts Health Connector (Massachusetts’ insurance exchange) a three-month extension, until June 30, for subsidized insurance programs that were set to expire to provide Massachusetts with extra time to make its troubled insurance exchange function.  CMS’ extension is in acknowledgment that the state’s exchange is not functioning.

IN THIRD PARTIES

The American Medical Association (AMA) has been lobbying forcefully in favor of the SGR repeal and replace legislation offered last week.  The AMA will not, however, speak to how this legislation should be paid for, which is the biggest obstacle to the legislation’s passing.

The Senate has been considering a proposal to extend unemployment insurance that would extend the 2% Medicare sequester cut that kicked in last year by one more year until 2024. On February 10, several of the nation's largest hospital groups joined together to send a letter that urges senators to oppose extending Medicare sequester (which refers to the automatic spending cuts to federal government spending) cuts to restore unemployment benefits.

Topics:  Affordable Care Act, Delays, Employee Benefits, Employer Mandates, Healthcare, Healthcare Reform, Pay or Play, Shared Responsibility Rule

Published In: Elections & Politics Updates, Health Updates, Labor & Employment Updates, Tax Updates

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© Cozen O'Connor | Attorney Advertising

Don't miss a thing! Build a custom news brief:

Read fresh new writing on compliance, cybersecurity, Dodd-Frank, whistleblowers, social media, hiring & firing, patent reform, the NLRB, Obamacare, the SEC…

…or whatever matters the most to you. Follow authors, firms, and topics on JD Supra.

Create your news brief now - it's free and easy »