The White House said within hours of President Donald Trump signing the tax reform bill in December that ObamaCare was “essentially” repealed. The reality is something different.
While the recently approved tax law did include a provision to eliminate the Affordable Care Act (ACA) individual mandate, the ACA remains the law of the land for 2018 and other provision of ObamaCare are still in force. (The individual mandate, which requires most individuals to have insurance or pay a penalty, remains in force for 2018 and is eliminated in 2019.)
So, you may be asking, what is – and what is not – changing this year? Here’s a quick overview:
Federal and State Exchanges
The online marketplaces established under the ACA will continue to operate. The Covered California exchange continues to accept enrollment for 2018 through the end of January, and all exchanges will continue to accept applications from those experiencing a qualifying event during the year. Subsidies for coverage will remain available to those individuals making less than 400 percent of the federal poverty level (about $98,000 for a family of four).
The back-door elimination of the ACA individual mandate (through tax legislation) does not eliminate the employer mandate; it remains in force for 2018 – and the foreseeable future unless there’s further action by Congress. That means, most employers with 50 or more full-time or full-time equivalent employees will continue to be required to offer health plans that comply with the ACA to their employees. Link here to read more on the Employer Shared Responsibility provisions on the Internal Revenue Service (IRS) website.
Association health plans (AHPs) are likely to make a big splash later this year (or early next year). The 60-day comment period on the Trump administration proposal to update the rules for these plans is now underway. As proposed, AHPs would allow small business owners, their employees, sole proprietorships, and other self-employed individuals to band together as a single group to purchase health insurance in the large group market. (As larger employers, the consolidated group would be exempt from some of the current requirements of the ACA. For example, AHPs would not have to include the ACA’s “essential health benefits” such as mental health, emergency services, maternity and newborn benefits, and prescription drugs.
Critics of association health plans, including consumer groups, public health advocates, and many insurers (including Blue Cross and Blue Shield plans) say new association plans will drive up health care costs for older Americans and those with pre-existing health conditions as younger, healthier workers leave their current health plans and move to less comprehensive, less expensive plans developed as a result of the AHP proposal.
“Those with serious health conditions like cancer would be left paying ever-increasing premiums for comprehensive coverage,” said Chris Hansen, the president of the American Cancer Society Cancer Action Network told the New York Times. “The rule proposed today will almost certainly result in more people facing financial distress when an unexpected health crisis happens.”
State “Single Payer” Proposal
While the White House and GOP members of Congress continue their efforts in Washington, DC, to undermine the ACA, California lawmakers are continuing to explore the expansion of health care through a single payer measure. As outlined, Senate Bill 562 would establish a program to deliver health care to all Californians.
However, Assembly Speaker Anthony Rendon (D-Paramount) said last year the bill was “woefully incomplete” and he shelved it. The measure is likely to come back into view this year, as some of the leading candidates for governor support single payer. Costs remains a big issue, though, as it’s estimated single payer could run a $400 billion tab over a decade. Stay tuned for further updates.
If you’re considering health insurance for your employees for the first time, or you’re considering a change to your current employee benefits, you’ll want to talk with your broker about CaliforniaChoice. It is the only place where you and your employees can select coverage from seven of California’s leading health plans in one program. If you don’t already have an employee benefits brokers, we can help you find a CaliforniaChoice broker to answer all of your questions and provide you with a custom quote.