The United States House of Representatives is scheduled to vote on legislation addressing employer-related provisions of the Affordable Care Act (ACA). The House Ways and Means Committee also is expected to consider retirement-related legislative provisions.
The House will vote later this week on the Save American Workers Act (H.R.3798) (Act), https://rules.house.gov/bill/115/hr-3798, which would delay implementation of the ACA’s Cadillac tax until 2023. The proposal, if adopted, would also retroactively suspend the employer mandate penalty so that employers would not be assessed penalties for failure to comply with the employer mandate during the period beginning January 1, 2015 and ending December 31, 2018.
Further, the Act would repeal the 30-hour definition of full-time employment and would retroactively define a full-time employee as someone who averages 40-hours per week or 174 hours per month. The Act would relax the requirement that employers provide notices to individuals about their health care coverage. The legislation provides that group health plan sponsors and health insurance issuers would be required to provide individuals with a statement of their health insurance coverage only upon request, beginning in 2019. Finally, the pending proposal would also repeal the indoor tanning tax.
The Ways and Means Committee also is expected to consider a package of bills that would make the 2017 tax law’s individual tax reform provisions permanent. These proposed reforms address certain retirement and family savings proposals that would extend the individual tax provisions enacted by the Tax Cuts and Jobs Act of 2017. Proposed reforms include, among others, provisions to allow small employers to join together to create 401(k) plans more affordably, allow employers sufficient time to establish such plans, simplify rules for participation in employer-sponsored plans, exempt small employer retirement accounts from mandatory cash-outs, eliminate the age limit on IRA contributions, allow military reservists to maximize their retirement contributions, create so-called universal savings accounts, expand 529 accounts to include apprenticeship fees, home schooling expenses and student debt as eligible expenses to be paid from a 529 account, and permit withdrawals from retirement accounts following the birth or adoption of a child without penalty. Amounts withdrawn could also be repaid into the account.
While the pending proposal could restore freedom of choice for many employers and individuals in matters impacting health, it is not clear that adoption would necessarily reduce the cost of healthcare. The state of New Jersey has adopted laws which Governor Murphy believes contributed to a decrease in New Jersey health insurance premiums by nearly 9.3%. In one such law, New Jersey preserved the “individual mandate” under Obamacare, which the Trump administration eliminated at the federal level. In another, the state implemented a reinsurance program, a reimbursement system that protects insurers from very high claims, beginning next year. https://www.nj.com/politics/index.ssf/2018/09/nj_health-care_rates_will_drop_next_year_murphy_sa.html. Whether the federal legislation will be promulgated into law still remains to be seen. However, New Jersey’s legislative initiatives clearly have effectively reduced costs, reinforcing the vitality of the Affordable Care Act’s mission.