Employers expected to keep some of health law's popular provisions, even if Obama loses

Published: Tuesday, November 06, 2012 @ 10:36 AM
Updated: Tuesday, November 06, 2012 @ 10:36 AM

No matter who wins the presidential election, most workers who get health insurance through their jobs won't see a lot of immediate changes in their health benefits.

Employers will continue looking for ways to cap expenses, moving toward higher deductible policies, or placing limits on how much they pay toward their workers’ premiums -- both trends that predate the federal health law, analysts say.

Many employers have also embraced some of the more popular rules in the federal health law, such as no copays for certain cancer screenings and preventive care, and allowing parents to keep their adult children on their policies until age 26.

Employers have "experimented with (those ideas) for the better part of a decade now," says Paul Fronstin of the Employee Benefit Research Institute in Washington D.C.  "There’s no going back."

Still, the law itself may be affected by whom the electorate chooses to send to the White House and Congress next year, in ways that could make big differences over time.

Republican nominee Mitt Romney has promised to repeal the law if elected, although it is uncertain he would have the congressional votes to do that, or how long such efforts might take. Some provisions, such as federal subsidies to help some people buy coverage in new insurance marketplaces, would likely fall by the wayside if major parts of the law were dismantled, for instance.

In contrast, the re-election of President Barack Obama would mean the major provisions of the law will likely go into effect as planned in 2014, including rules that require employers with more than 50 full-time workers to offer health insurance or face fines starting at $2,000 a worker if they get federal subsidies to help them buy coverage. Employers would also need to ensure their coverage meets affordability standards and give workers easy-to-understand descriptions of their benefits.

While a host of rules have already been issued, employers say they are still waiting for some, including final word on how to design employee wellness programs, how to report worker eligibility for coverage and whether all workers must be given the same benefits.  Tracy Watts, a senior consultant with Mercer, says employers "have a lot of questions to be addressed" and expects a flurry of regulations in the next few weeks, no matter who wins the election.

'Big Fear Is … Uncertainty'

Consultants say a Romney win would raise a host of questions among employers who have begun to prepare for the law. Would it be repealed entirely? Or, as many observers expect, would Congress attempt to amend it, and if so, which parts?

"The big fear is one of uncertainty, not knowing what would happen, how it would work," says Gretchen Young, senior vice president for health policy at the ERISA Industry Committee, which represents large employers.

One big focus for employers would be whether Congress would change rules already in effect that bar health insurers from setting lifetime limits on insurance policies. Previously, such limits were seen as one way to hold down premium costs, but also caused some people stricken with serious illness to suddenly find themselves cut off from coverage when they hit the limit. 

"If the law is repealed, we may see employers reintroducing annual limits or lifetime limits," says Fronstin.

The law includes other provisions affecting employers and employees that might be changed or eliminated under a Romney administration. Starting in 2014, individuals and small businesses are supposed to be able to shop for and enroll in coverage and determine eligibility for federal subsidies, through state-based marketplaces, called exchanges.

In addition to the online exchanges, the law provides tax credits to help some small businesses purchase coverage.  Individuals earning less than about $44,680 who don’t get coverage through their jobs could also qualify for sliding scale subsidies to help them buy through the exchanges.

Some small business groups, such as Small Business Majority, support the law, saying the exchanges could boost competition, potentially easing volatility in premiums, and providing workers with greater choice of insurance carriers.  Even so, rules setting essential health benefits and capping the amount small businesses can charge workers in annual deductibles could raise costs for some employers. Other groups, including the National Federation of Independent Business, oppose the law, saying its requirements are burdensome.

Success of the exchanges, however, will depend on how many people and businesses use them.  Too few enrollees could drive up premiums if those who choose to enroll are sicker or older than those who sit out.  

And subsidies will be key to getting people to enroll through the exchanges, experts say.  Such funding, however, is expected to be a target of the law’s opponents.

"I don’t think people are convinced that Romney would repeal the whole thing, but certainly huge swaths of funding could be taken out," says Young. "If you take out the subsidies, then the exchanges won’t gain a toehold and may well collapse."

Most Employers Expect Higher Costs

Premium costs will be another key factor in enrollment in the exchanges. The Congressional Budget Office has estimated that premiums for big employers will be a little lower under the law, while costs for small businesses will remain about the same. Individuals will see higher premiums, mainly because coverage will be more comprehensive. For some individuals, the CBO said the additional cost would be offset by subsidies.

A survey by consulting group Mercer released in August found that 60 percent of the 1,200 responding employers expected some cost increase from the law in 2014.  Watts says those costs are mainly related to having to cover more workers – including those employed at least 30 hours a week --  or from higher employer payments toward the benefit packages.

"The law does figure out how to provide access to benefits for 30 million Americans who don’t have it," says Watts. "Beyond that, there’s not a whole lot in there that helps manage costs for employers. You could argue that will be a byproduct of the law, but there’s no certainty around that. Time will tell."

No matter the outcome Tuesday, she and other consultants say the trend toward private insurance exchanges will continue. Employers like the concept because the private marketplaces make it easier for them to set caps on the amount they pay toward premiums, allowing employees to choose more expensive plans if they pay the difference. 

If premiums rise faster than the caps set by employers, workers would pay more, picking up a growing share of costs. Proponents expect a tempering effect on premiums, however, through competition among insurers that sign up to offer coverage through the private exchanges.

A number of private exchanges, run by consulting firms and insurers, are already capitalizing on the trend, offering an alternative to the future state-based marketplaces.

Benefit consultant Aon Hewitt, for example, has a private exchange for its workers andrecently signed deals with Darden Restaurants and retailer Sears, which will send tens of thousands of their workers to the exchange starting in January.

UnitedHealth Group, one of the nation’s largest insurers, has purchased Connextions, a firm that helps form exchanges. The Blues plans, through Wellpoint and Blue Cross Blue Shield of Michigan, have bought into Bloom Health, which runs an employer exchange.

"On the employer side, private exchanges are the main action under either an Obama or Romney administration," says Joel Ario, a consultant at Manatt Health Solutions and former Obama administration official in charge of exchange planning.

He says state-based exchanges, like the one already operating in Massachusetts, work well for individuals, but have not caught on as fast with employers. "A lot of employers will be saying they like the exchange idea, but may not want to be in the public exchange, unless they can get a tax credit."

Top military general vows full explanation on Niger ambush

Published: Monday, October 23, 2017 @ 4:42 PM

Giving some of the first public details about a firefight in the African nation of Niger that resulted in the deaths of four U.S. soldiers earlier this month, Joint Chiefs Chairman Gen. Joseph Dunford said on Monday that a full military investigation which is underway into the incident will hopefully provide more detailed answers on what happened.

“I think first and foremost in this particular case, we owe the families as much information as we can find out, about what happened,” the General said.

Gen. Dunford said the American soldiers werer part of a regular October 4 patrol, but suddenly found themselves in a firefight with attackers who have pledged their support for the Islamic State.

“They did not expect resistance on this particular patrol,” Dunford said. “Again, what happened will be the subject of the investigation.

The general said the current rules of engagement for U.S. forces in Niger are that they go out on patrols with friendly forces only “when the chances of enemy contact are unlikely.”

“They were equipped with machine guns and small arms,” Dunford said, adding that the attack on the American and Niger force was done with small arms, machine guns and rocket propelled grenades.

The General said five Niger soldiers were killed in the same incident, as he vowed to get all of the details of what happened, and deliver those facts not only to the Congress – but to the families of the soldiers as well.

After a week of increasingly acidic exchanges between the the family of one soldier who died in the event and top officials at the White House – including the President – Gen. Dunford’s tone was decidedly more measured, as he repeatedly told reporters that questions about the details of the firefight were entirely ‘fair.’

Treasury Dpt. slams Cordray plan on class action suits

Published: Monday, October 23, 2017 @ 1:04 PM
Updated: Monday, October 23, 2017 @ 1:04 PM

Richard Cordray. Getty images.
Richard Cordray. Getty images.

The Treasury Department Monday assailed a new rule adopted by a federal agency headed by former Ohio Attorney General Richard Cordray, charging it would lead to thousands of new class-action lawsuits and cost businesses $500 million in legal fees during the next five years.

The report, which is expected to add fuel to Senate Republican efforts to scrap the rule as early as this week, claims Cordray’s decision allowing Americans to join class-action lawsuits against their credit card companies would lead to $1.7 billion in additional legal settlements during the next five years and higher costs for Americans borrowing money from their credit cards.

“It is far more likely that the rule will generate massive economic costs – borne by businesses and consumers alike,” concluded the report released by the Trump administration.

The Consumer Financial Protection Bureau this year instituted a rule that allows Americans to take their complaints about their credit cards and bank accounts to court. Before the rule was adopted, most credit card companies required that any dispute between the companies and Americans be settled through mandatory arbitration.

Sen. Sherrod Brown, D-Ohio, sharply criticized the report, saying “when large financial institutions like Wells Fargo and Equifax use forced arbitration to cover up egregious cheating, it’s working people in places like Ohio who pay the price,” adding the Treasury Department “has cherry-picked its arguments.”

In an opinion piece originally published in the New York Times in August, Cordray complained that “opponents have unleashed attacks to overturn the rule,” adding the rule “does not ban individual arbitration, as our opponents falsely claim.”

“It simply ensures that consumers have the option of joining together to sue companies,” Cordray wrote in the piece which was re-posted last week on the consumer bureau’s web site. “Companies and consumers can still use arbitration to resolve their differences, but companies cannot unilaterally block group lawsuits.”

Cordray wrote that the consumer bureau calculated that the new rule would impose less than $1 billion in new costs for the nation’s banks which he said reported $171 billion in profits last year.

Congressional Republicans and Trump have sharply objected not only to the rule, but the consumer bureau itself. The House this summer voted 231-190 to overturn the arbitration rule. The Senate could vote as early as this week on scrapping the rule.

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Echoing Reagan, Trump pushes Congress to act swiftly on tax reform

Published: Sunday, October 22, 2017 @ 10:05 PM

Pushing the House to take another step this week on the road to major tax reforms, President Donald Trump used an op-ed in USA Today to argue that GOP tax plans will “ignite America’s middle class miracle once again,” as he channeled former President Ronald Reagan, saying with “tax reform, we can make it morning in America again.”

“Revising our tax code is not just a policy discussion — it is a moral one, because we are not talking about the government’s money – we are talking about your money, your hard work,” the President wrote.

Mr. Trump meanwhile used a conference call with House Republicans on Sunday to make much the same argument – that now is the time for action on tax reform.

Here is where things stand on Capitol Hill when it comes to GOP plans to move legislation on tax reform.

1. The budget comes first for the GOP. Before they can focus solely on tax reform, Republicans must approve a non-binding budget outline for 2018, which would authorize expedited action on a tax bill – without the threat of a Senate filibuster. The Senate approved their plan last Thursday, and now the House seems ready to accept that this week, though the budget details are sure to give some GOP fiscal hawks some heartburn, as the plan would not ensure a balanced budget within ten years. But GOP leaders are basically telling rank and file Republicans that now is the time for tax reform, and that there is no use in getting caught up in a battle over budget cuts. Look for the House to vote later this week.

2. But ‘what if’ the House refuses to go along? If enough Republicans refuse to vote for the Senate-passed budget, then there would have to be formal House-Senate negotiations, which could take some time to hash out a deal on the budget resolution for 2018. That would obviously delay work on tax reform, and make it that much more difficult to swiftly get a tax bill moving on Capitol Hill. It seems unlikely that will happen, as more conservative lawmakers have been assured they will get votes on measures dealing with budget savings. But it is safe to say that the ‘normal’ Republican focus on budget deficits has melted away now that the GOP is in charge of the White House and Congress. Here is the sales pitch being made by the Republican Study Group, which says Speaker Paul Ryan has promised votes on some budget-related bills.

3. Let’s assume the House approves the budget – then what? If the House heeds the advice of President Trump, and votes for the Senate-passed budget outline this week, then the focus will shift to the tax-writing committees of the House and Senate – the House Ways and Means Committee, and the Senate Finance Committee, as they produce an actual tax reform bill. Remember – we don’t have a bill as yet from the White House – just some bullet points. In 1985, President Reagan sent Congress an actual 489 page bill as a starting point. President Trump’s bullet points are just a small piece of a much larger bill that is expected to be released by Republicans, as the scrums of reporters grow each day for key lawmakers, like Sen. Orrin Hatch (R-UT), the Chairman of the Senate Finance Committee.

4. What’s the possible timing on tax reform? Ask veterans of Capitol Hill what they think about a GOP tax plan, and they cannot imagine it getting done this year (or even at all). But the White House and GOP leaders in Congress keep talking about doing it fast, maybe having a vote in the House before a Thanksgiving break, and a Senate vote in December. If we go back and look at the tax reform timeline in the Reagan Administration, it took a lot longer. The House Ways and Means Committee started work on a draft bill in late September 1985 – it took two months to finish. The deal almost fell apart in December, as the House voted to approve that plan just before Christmas. In the Senate, it took six months to get the bill out of committee and to a vote, in June 1986. In other words, Republicans think they can move at legislative warp speed compared to thirty one years ago in the Congress.

5. Remember, there are a lot of details involved. If you are going to do just tax cuts, that’s pretty straightforward. But if you are going to try to do sweeping tax reform – for both the individual and corporate sides – that is very complicated. Just look back at 1986, and you can see that bill is filled with rifle-shot provisions intended to help just one company or group. Back then, there was no way to get this out to the voters. But with the internet and social media, these types of provisions will get a lot of attention and scrutiny.

6. One more thought on timing – from 1986. As I write this on October 22, it is 31 years to the day that President Reagan signed the Tax Reform Act into law. But I clearly remembered the final agreement being struck in August – and the vote taking place soon after Labor Day. My memory was correct. So, why did it take another month for the President to sign the bill into law? For one, there were a number of errors in the final agreement, which needed to be fixed. So, on September 25, 1986, the House passed H. Con. Res. 395, to make “technical and clerical” corrections in the final bill. The Senate took that up a few weeks later, and made some changes, which were sent back to the House. The House made a few more changes. But no final resolution was agreed to, as the Congress adjourned for the year on October 18, 1986. So, four days later, the President signed the bill into law anyway. Want to do some more reading about what happened in 1986? Here you go:

And by the way, that explanation of the 1986 Tax Reform Act runs almost 1,400 pages. Happy reading!

Trump voting commission criticized for lack of transparency

Published: Sunday, October 22, 2017 @ 5:43 PM
Updated: Sunday, October 22, 2017 @ 5:43 PM

            Trump voting commission criticized for lack of transparency. Getty image
Trump voting commission criticized for lack of transparency. Getty image

President Donald Trump’s advisory commission on election integrity has integrity questions of its own — with some of its own members raising concerns about its openness.

This past week, two members fired off letters to commission staff complaining about a lack of information about the panel’s agenda and demanding answers about its activities. That comes as Democratic U.S. senators are requesting a government investigation of the commission for ignoring formal requests from Congress.

The criticism from the commissioners was remarkable because it came from insiders — the very people who are supposed to be privy to its internal discussions and plans.

In a letter sent Oct. 17, Maine Secretary of State Matthew Dunlap said it was clear he was not being made aware of information pertaining to the commission. He requested copies of all correspondence between commission members since Trump signed the executive order creating it in May.

“I am in a position where I feel compelled to inquire after the work of the commission upon which I am sworn to serve, and am yet completely uninformed as to its activities,” Dunlap wrote in his letter to Andrew Kossack, the commission’s executive director.

He said he had received no information about the commission’s research or activities since its last meeting, on Sept. 12. He also said he continued to receive media inquiries about commission developments “that I as a commissioner am blind to.”

A commissioner from Alabama, Jefferson County Probate Judge Alan L. King, said he sent a similar letter late last week. He said the only information he has received since the commission’s meeting more than a month ago was an email informing him of the death of a fellow commissioner, former Arkansas state lawmaker David Dunn.

“Here I am on this high-level government committee, and I don’t know when the next meetings are or how many meetings there will be,” he said in a telephone interview. “I am in the dark on what will happen from this point on, to tell you the truth.”

King and Dunlap are two of four Democrats on the 11-member commission.

Requests for comment sent to Kossack, the commission’s executive director, and the commission’s vice chairman, Kansas Secretary of State Kris Kobach, were not returned.

J. Christian Adams, a commission member who was a Justice Department attorney under former President George W. Bush, said in an email that all commissioners were receiving the same information.

“Once upon a time election integrity was bipartisan,” Adams said in the email. “Apparently not all agree. That’s a shame.”

The commission has stirred controversy from the moment it was established last spring. Critics say Trump is using it to find support for his unsubstantiated claims of widespread voter fraud that cost him the popular vote during the 2016 election. Democrat Hillary Clinton received 2.8 million more votes nationwide than Trump.

While there have been isolated cases of voter fraud in the U.S., there is no evidence of it being a widespread problem, as Trump suggests.

Critics argue the commission is stacked with people who favor voting restrictions, rather than those who want to expand access, and that the commission has a predetermined agenda that will result in recommendations making it more difficult for people to register to vote, stay registered and cast ballots.

Its first significant action was to request a wide range of information about all registered voters in every state, including partial Social Security numbers, dates of birth, addresses and voting history. The commission scaled back its response after stinging criticism. A tally by Associated Press reporters nationwide shows that 15 states denied the request, raising questions about how useful the information will be.

In August, the AP filed a records request with the commission under the federal Freedom of Information Act. The law specifies that agencies — including presidential commissions — have 20 business days to respond or 10 calendar days if the request was filed on an expedited basis, as the AP’s was. To date, the AP has received no response from the commission despite multiple attempts to get one.

The commission’s secrecy prompted a lawsuit by the Lawyers’ Committee for Civil Rights Under Law, which alleges the commission is violating federal open meetings and disclosure laws.

The group’s executive director, Kristen Clarke, said she was hard-pressed to think of another commission that had acted in such secrecy.

“We have found that, in every respect, this commission has been carrying out its activities in an almost covert fashion,” she said.

The lack of openness even applies to members of Congress.

Democratic senators have filed at least five separate requests for information with the commission since June, and a Sept. 12 follow-up letter noted that none of those had received a response.

“The Commission has not responded to a single letter from Senators with oversight jurisdiction over the Commission and continues to be rebuked for its questionable activities,” said the letter by Democratic Sens. Amy Klobuchar of Minnesota and Sheldon Whitehouse of Rhode Island.

Last week, a group of three Democratic senators wrote the Government Accountability Office seeking an investigation into the commission because of its lack responsiveness and transparency. The letter signed by Sens. Michael Bennet of Colorado, Cory Booker of New Jersey and Klobuchar cited a lack of transparency on the commission and concern that its conclusions would diminish confidence in the democratic process.

“It is incredible that they are not responding to any of this stuff, and that’s why it’s appropriate for GAO to take a look,” Bennet said in an interview.