It was anticipated. It happened. The Republicans have taken control of the Senate. So what can benefit managers tell employees who are concerned about possible changes surrounding the Affordable Care Act?
James Slotnick, advanced planning attorney, broker education at Sun Life Financial, has a simple answer: “It’s important to just be honest. Every year the cost of health insurance goes up. Let them know you’re aware of what’s going on in Washington, and you’ll do your best at keeping costs low.” But, he adds, changing the ACA might not be as easy as many may be led to believe.
Instead, step back, Slotnick says, and consider that open enrollment begins in two weeks. Nov. 15 will be a big day, he says.
Today, according to the Congressional Budget Office, roughly seven million are enrolled in public exchanges, and the CBO predicts by 2024, roughly 25 million Americans will be receiving their health care insurance through the marketplace.
While there will be a lot riding on open enrollment to basically double current numbers, there will be many challenges that will face GOP members who want to overturn the ACA.
“I think the Affordable Care Act is here to stay,” says Mike Thompson, principal with consulting firm PricewaterhouseCoopers. “There’s likely to be continued tinkering around the edges to improve and make technical corrections to make it work better but, so much has happened in the meantime that has really changed the way employers and the entire industry operate that it would be hard to put the genie back in the bottle.”
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“Whether or not you like the ACA, by the time the new senators are sworn into office, there may be 13 million Americans on the exchanges getting insurance,” Slotnick says. “It makes it more difficult to change the legislation when you have tens of millions of Americans already getting their health insurance.”
Full repeal versus dismantling
“While the election may influence the future of some components of the ACA, it’s our position that the law is here to stay,” says John Turner, president and CEO at Corporate Synergies Group.
Turner says there will be difficulties in taking away benefits that already exist. “Right now we caution employers not to change their current focus because of election results,” he says. “Businesses should direct their activities based on the current law, and that means they are responsible for ensuring their health insurance plans are in compliance.”
Additionally, Slotnick adds, due to Senate rules, Republicans won’t be able to just introduce whatever legislation they want to the floor. While political experts are expecting Republicans to end up with 54 seats in the Senate when all votes are counted and runoffs completed, 60 votes will still be required to get legislation to the Senate floor.
There have been 50 House bills to change the ACA, Slotnick says. “It seems unlikely you’ll see six Democrats say they want to see a full repeal.” But, there have been signals that some will work across the aisle for repeal some of the bipartisan “low-hanging fruit,” he says.
For example, the medical device tax could be something both Democrats and Republicans can get behind in repealing, he adds. “It works for the Republicans to go back to their constituents and say ‘see, we’re taking the law apart’; and it works for the Democrats who can go back and say, ‘see, we’re willing to work to make the ACA better.’”
“If Republicans had control of the House, Senate and Oval Office, then maybe they can make major changes,” Slotnick says. “But in the meantime, you still have Obama in the White House and he won’t sign anything that drastically changes the law. Major fundamental changes in the next two to three years aren’t realistic.”
While Republicans will have “a healthy majority” in the Senate, “they’ll still have to work with Democrats to get things done.”
Judicial changes
Politics aside, Slotnick says next Monday’s judicial announcement – when the Supreme Court announces whether or not it will hear King v. Burwell – to have more real implications on the ACA than Tuesday’s election. That case will decide if the Internal Revenue Service may extend tax-credit subsidies to coverage purchased through federal exchanges.
“That ruling has massive impacts on the employer mandate,” he says. “The employer mandate cannot survive if only state-run exchanges are eligible to issue them.”
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In addition, there is another similar ruling to keep an eye on, he says. The full U.S. Court of Appeals for the District of Columbia will be reviewing Halbig V. Burwell and is set to hear oral arguments in December. This follows a 2-1 decision this past summer in favor of the plaintiff.
Further employer impact
In addition to the potential political machinations as part of the Senate turnover, benefit managers will have to cope with the economic realities of a wave of wage and benefits measures approved in a variety of states.
Minimum wage hikes were approved in four states and two cities in Tuesday’s midterm elections: Alaska, Arkansas, Nebraska and South Dakota, and Oakland and San Francisco, Calif.
Voters in Massachusetts, meanwhile, approved a statewide paid sick days law, joining Connecticut, California and Washington, D.C., as jurisdictions that now require employers to provide some type of paid leave. Paid sick leave measures also passed in Oakland, Calif. and two cities in New Jersey – Montclair and Trenton.
