NEWS RELEASE

June 17, 2015
NR 2015-13

For additional information:
Jason Hammersla
office 202-289-6700 / cell 202-422-4652

Regardless of high court's decision in King v. Burwell
Employer health plan sponsors urge swift action to improve PPACA, workers' well-being

WASHINGTON, DC —Congress must take steps now to ensure the viability of employer-sponsored health benefits, regardless of the forthcoming Supreme Court decision concerning exchange subsidies," American Benefits Council President James A. Klein said upon unveiling a package of legislative recommendations.

"If the Supreme Court strikes down the availability of subsidies, Congress may believe that is the only issue to be addressed -- If the Court upholds the subsidies, Congress might conclude that it is 'business as usual' and take no action. In fact, several aspects of the Patient Protection and Affordable Care Act (PPACA) require legislative attention now to preserve employer-sponsored health coverage," Klein asserted.

Last year the Council issued its long-term policy strategic plan, A 2020 Vision: Flexibility and the Future of Employee Benefits, which includes 46 specific legislative and regulatory proposals to help Americans achieve health and financial well-being. Among the recommendations are several designed specifically to make PPACA more administrable and preserve employer-sponsored health coverage.

"Since the report was issued we have advocated for these ideas on Capitol Hill and are gratified that several of them enjoy bipartisan support. As the country anxiously awaits the Supreme Court's ruling, we highlight six of those recommendations on which Congress needs to take action immediately," Klein said.

The Council is urging Congress to:

  • Expand Health Reimbursement Arrangements to allow employers to fund an account that employees could use to purchase individual coverage inside or outside the exchanges.
  • End the 40 Percent Tax on high-cost coverage (the so-called "Cadillac plan" tax), which is already threatening health plans, whether rich or not, and pushing employers to take dramatic measures to avoid the tax.
  • Modify the employer "Shared Responsibility" requirement to relieve some administrative costs and burdens on employers that create disincentives for employing "full-time employees" as defined by the law.
  • Simplify the significant new and complex employer reporting requirements to the Internal Revenue Service.
  • Repeal the requirement that employers automatically enroll new full-time employees in health plans, which is unnecessary since virtually everyone is legally required to have coverage and which, ironically, can have adverse consequences on employees' eligibility for premium tax credits and cost-sharing reductions.
  • Improve Health Savings Accounts (HSAs) including clarification that certain prescription drugs are preventive care that may be covered before an employee has satisfied his or her deductible, and clarification that employers may provide care at on-site medical clinics free of charge without first requiring an employee to meet his or her deductible.

"Congress' bold action to pass the 'doc fix' demonstrates lawmakers' willingness to work on a bipartisan basis to resolve problems," Klein said. "The same should be done here. Even if the U.S. Supreme Court upholds the availability of subsidies in federal exchanges, the urgency to address these other challenges to employer-sponsored coverage will remain. This is the time for action," Klein concluded.

For more information, or to schedule an individual interview with Council staff, contact Jessica Chirico at jchirico@abcstaff.org or by phone at 202-289-6700.

MATERIALS:

Magnifying A 2020 Vision: A Closer Look at Selected Proposals to Strengthen Employer-Sponsored Health Benefits

Optional background materials on the 40 Percent Tax on high cost plans:

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The American Benefits Council is the national trade association for companies concerned about federal legislation and regulations affecting all aspects of the employee benefits system. The Council's members represent the entire spectrum of the private employee benefits community and either sponsor directly or administer retirement and health plans covering more than 100 million Americans.