10 things employers want from a Trump administration
With Donald Trump officially in office as the 45th president, many employers are expressing cautious optimism for potential changes during his presidency — including killing the ACA’s burdensome Cadillac tax, focusing on ever-rising healthcare costs and expanding access to health savings accounts. And that’s just the beginning. Employee Benefit News spoke with experts and business insiders about what employers would like to see the Trump administration act on in the coming years.
Kill the Cadillac tax.
Virtually all employers are calling for the repeal of the ACA’s Cadillac tax. “Protecting the employer-sponsored health insurance that benefits 178 million Americans starts with repealing burdensome reporting mandates and unnecessary taxes — especially the Affordable Care Act’s destructive 40% Cadillac tax on health benefits,” says Annette Guarisco Fildes, president and chief executive of the ERISA Industry Committee. “That’s why [we are] working with the new Congress to repeal this tax. We look forward to partnering with the Trump administration to stop the damage the Cadillac tax is already doing to working families’ health insurance, to prevent any new taxes on workers’ hard-earned benefits, and to replace the ACA with market-driven reforms that can get healthcare costs under control.”
Focus on healthcare costs.
“I would like to think Trump’s heart is in the right place — he wants to put consumers and patients first; he knows there is a problem with healthcare costs,” says Mike Thompson, president and CEO of the National Alliance of Healthcare Purchaser Coalitions. “I think having a fresh look at these things could be helpful. What’s concerning is if it doesn’t get beyond over-simplified solutions to very, very complex problems. The more that he can enable thoughtful policymaking and break the logjam of some of these issues that have been around for decades, the better.”
Give employers time to plan and re-navigate when it comes to Affordable Care Act changes.
As Trump begins to work on repealing and replacing the Affordable Care Act, employers are hoping the administration makes changes in a suitable way —one that makes sense for employers and others who have to comply with the law. “We will see changes to the ACA, there’s no doubt,” Thompson explains. “If anything, we might see ACA repealed with some sort of forward-looking timeframe so they have time to replace it with something. Trump has made a point that he won’t leave people in the lurch in the meantime; frankly, having a time-limited chance to put something in place is an opportunity to take a thoughtful relook at how we do it.”
Bring a new, non-political perspective to healthcare matters.
“My take is that a leadership change of the kind President Trump is bringing to Washington has been needed for a very long time,” says Chris Fey, CEO of Big Bang Health. “A new, non-political fresh set of eyes, with a keen vision for performance and budget metrics, is what this country needs, and what U.S. businesses and families want and deserve. Big Bang Health management believes the Trump presidency will accelerate growth in health benefits’ role as a consultant vs. a broker of services. [I expect Trump to bring a] change in the healthcare industry and a willingness to address changes that have been needed for a very long time. The HR executives and benefit consultants who [embrace] this awakening that is already occurring will do well in the years ahead.”
Expand access to health savings accounts.
Many employers expect Trump to deliver on his promise to expand health savings accounts and make contributions tax-free.
“Trump wants contributions into HSAs to be tax-free and to be allowed to become part of the estate of the individual HSA accountholder,” explains Daniel Kuperstein, senior vice president of compliance for Corporate Synergies. “Accordingly, HSA account holders would be allowed to pass on accumulated HSA funds to their heirs without fear of any ‘death penalty.’ Trump also wants it to be easier for any member of a family to transfer HSA funds without penalty. While HSAs have become even more popular with employers in recent years, these new rules are likely to significantly increase their popularity with employers and individuals alike.”
Keep employers informed.
“The employee benefits industry nationwide will be watching to see how the new administration will maintain or change legislation and regulations impacting benefit plans,” says Michael Wilson, CEO of the International Foundation of Employee Benefit Plans. “Employers and plan sponsors will do all they can to remain informed and compliant.”
Delay employer reporting requirements.
“Employer reporting is key to assessing employer penalties under the employer mandate, [but it] represents a significant burden to employers, and the deadlines are fast approaching,” explains Joy Napier-Joyce, principal and leader of the employee benefits group at labor and employment law firm Jackson Lewis P.C. “We have not seen enforcement of employer penalties under the employer mandate to date.”
The IRS last November announced that it would give employers an additional 30 days to distribute the ACA’s tax year 2016 information-reporting forms to employees, extending the deadline from Jan. 31, 2017, to March 2. Still, due dates for filing Forms 1094 and 1095 with the IRS remain unchanged: Feb. 28 for paper submissions or March 31 for electronic filing.
Continue a move to value-based care.
Brian Marcotte, president and CEO at National Business Group on Health, says that with Trump and HHS Secretary Tom Price in the White House, Medicare payment reforms likely will get a second look.
“They may advance a little more slowly,” Marcotte says, “and I think that concerns us a little. We would hope that HHS would continue to transform Medicare away from fee-for-service, which drives unnecessary care and spending, toward paying for value, and we’d like to keep our foot on the gas when it comes to transforming the delivery system and not lose momentum there.”
Revise summary plan description standards.
Many employers are hopeful that business-minded Trump will quickly revise summary plan description standards; regulations on formatting SPDs haven’t been updated in more than 15 years. This means that while businesses can choose to distribute SPDs in an electronic format, many still distribute them in paper form due to requirements employees must meet in order to receive their SPDs electronically.
“In the past 15 years the number of people who have access to the Internet, who are routinely using smartphones, iPads or other forms of technology outside of the workplace” has grown rapidly, says Kim Buckey, VP of client services at DirectPath. “Right now this seems like the perfect time to revisit this regulation.”
Reduce federal regulations.
Philippe Weiss, managing director of Seyfarth Shaw At Work, notes that in recent meetings with employees and employers, “employees were hopeful that promises of infrastructure spending and better trade deals would lead to more job security and work opportunities, at least in the short term. Managers and bosses, for their part, expressed hopes that reduced federal regulations could produce increased profits and faster growth.” Still, deregulation needs to be done thoughtfully, he says. “Tempering these hopes, however, some significant parallel fears were expressed: that deregulation would leave employees more exposed to possible employer abuses.”