It has been another busy week in Washington, D.C. as the Senate voted to start debate on "repeal and replace" legislation and has been considering different "repeal and replace" or repeal only options. This week's Senate activity started on July 25 when the Senate voted to start debate on a bill to replace the Affordable Care Act. The vote passed narrowly with Vice-President Mike Pence breaking the tie, 51-50. All Democratic Senators voted against the motion to proceed, joined by Republican Senators Susan Collins (R-ME) and Lisa Murkowski (R-AK). But, this is just a first step in a long process.
The Senate is debating various approaches to repealing and/or replacing the ACA. Each of those approaches is subject to amendments and changes as different interests offer objections and alternatives.
Here is a summary of what is happening:
- One bill that is up for revision is the House's American Health Care Act (AHCA).
- On the evening of July 25, the Senators voted on another bill — the Senate's BCRA plus an amendment proposed by Senator Ted Cruz allowing insurance companies to sell skeletal, low-cost insurance plans along with federally-compliant plans — along with another amendment for an additional $100 billion for Medicaid. Because these bills had not received scoring from the Congressional Budget Office, this amendment package needed 60 votes to pass. It failed, 43-57.
- On Wednesday, July 26, 2017, the Senate continued to debate and vote on revisions to the bill. They held a vote on the Obamacare Repeal and Reconciliation Act, which is an ACA repeal-only bill that is virtually identical to a reconciliation bill that passed Congress in 2015 but was vetoed by President Obama. This proposal was rejected, 45-55.
- Senate Minority Leader Chuck Schumer (D-NY) announced Wednesday night that Democrats would refuse to submit any further amendment proposals in the allotted debate time until details of the so-called "skinny" bill were made available to them. The Democrats want the opportunity to thoroughly review the bill to better inform their amendment proposals.
The path forward to comprehensive reform remains steep, but it appears that Congress is committed to passing some form of repeal and replace legislation. Although much uncertainty remains, next steps are likely to be as follows:
- Senate budget reconciliation rules limit the amount of debate allowed to 20 hours (10 hours for Republicans and 10 hours for Democrats). The clock started as soon as the Senate voted to proceed on the bill. The Senate will then debate for whatever remains of the original 20 hours of debate time (two hours have already been spent on debating BCRA).
- Next a process called a "Vote-a-rama" will begin, in which Republicans and Democrats will offer numerous amendments to the legislative language.
- After the Vote-a-rama, Majority Leader McConnell will likely introduce a Manager's Amendment to replace the bill passed by the House of Representatives in May. At this time, it has been reported that this Manager's Amendment could be a so-called "skinny" bill that repeals the individual and employer mandates and the medical device tax, but language has not been released.
- If the Senate passes Leader McConnell's Manager's Amendment or some other version, the bill will move to the House. If the Senate passes a "skinny" bill, it is likely that the House will request a conference with the Senate in which House and Senate conferees would try to negotiate a conference report that could pass both the House and Senate and be sent to President Trump for his signature.
What Else to Look For?
Any ACA "repeal and replace" bill as well as its amendments must comply with the "Byrd Rule," which requires a reconciliation bill to be limited to items related to the federal budget. The Senate parliamentarian decides what complies with the Byrd Rule and is, therefore, permitted to be part of a reconciliation bill. The Senate parliamentarian already has decided that the following provisions violate the budget reconciliation process: a temporary defunding of Planned Parenthood, a requirement that people with a break in coverage wait six months before buying individual health insurance, a change to allow insurers to charge older Americans at least five times what they charge younger individuals, and language allowing small businesses to establish "association health plans" that could be sold across state lines. Republican lawmakers reportedly are rewriting these provisions. Otherwise, the Republicans would need to get 60 votes on these provisions.
Guidance for Employers
Even though we are clearly on a roller coaster ride as it relates to possible regulatory changes in Washington, employers must still remain vigilant and comply with all ACA-related requirements. In fact, a letter dated June 30 was sent to a member of Congress from the Internal Revenue Service stating that the President's January 20th Executive Order does not impact or change the ACA-related tax provisions for organizations. While the uncertainty and additional anticipated activity around this may be complicated, it is critical for employers to remember that, until a new bill is officially signed by the President, the ACA remains the law of the land.
Follow our "Road to Repeal" series, as we report on this proposed legislation's path through the Senate debate, amendment and final vote — whether this week or in coming weeks depending on the Senate's timeline.
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