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2019 Legislative & Regulatory Outlook
UPMC Health Plan will be distributing a Legislative and Regulatory Outlook Producer Update on a monthly basis which will provide you timely and pertinent information on current health insurance related topics. Information will include status updates on rules, proposed bills and activities within the U.S. House of Representatives, Senate, Courts and Executive Branch that impact our industry. Below are recent updates on topics such as the ACA, Medicare and HRA's:
U.S. House of Representatives
The 116th Congress was sworn, with Democrats gaining control of the House of Representatives, and resulting subpoena power, for the first time during the Trump administration. House Democrats intend to use this power to conduct investigations into and oversight of Trump’s health care executive actions, such as cuts to Affordable Care Act (ACA) outreach and enrollment activities and efforts to expand use of health plans that skirt the ACA’s rules, such as short-term plans and association health plans.
U.S. Senate
In the Senate, Mitch McConnell (R-KY) retains his post as Majority Leader with an expanded Republican caucus. McConnell’s previously stated goals of entitlement reform and rollback of the ACA will be complicated by the divided Congress. It is likely that the Senate will focus on confirming executive and judicial nominees.
Medicare for All
With increasing national attention on expanding coverage, Speaker Pelosi has committed to holding hearings in the House Rules and Budget Committees on “Medicare for All” legislation. However, the hearings will not take place in either of the committees generally thought to have jurisdiction over health care issues. In the event single-payer legislation would pass the House, which is far from assured, it would likely fail in the Republican-led Senate.
ACA Taxes
While there is little Congressional appetite for it now, stakeholders remain committed to achieving repeal, or further delay, of the ACA’s taxes on health plans, medical devices, and high-cost “Cadillac” health plans. They are hopeful for action later in the year.
Regulations
The Administration has yet to release guidance for the 2020 Exchange plan year, which may be delayed due to the partial government shut down that began December 22, 2018. Stakeholders have expressed some concern that the Centers for Medicare and Medicaid Services (CMS) could use this guidance to curtail “silver loading,” a work-around developed in 2017, when the Administration stopped making cost-sharing reduction payments.
ACA Lawsuit
On December 14, 2018, a U.S. District Court Judge Reed O’Connor ruled that the Affordable Care Act’s (ACA) individual mandate to purchase health insurance is not constitutional due to repeal of the mandate’s tax penalty on January 1, 2019. O’Connor further ruled that the mandate cannot be separated from the rest of the law, ruling that the entire ACA must fall. On December 30, 2018, O’Connor issued a stay for his ruling, ordering that the law remain intact as the case undergoes appeal. Seventeen Democratic state attorneys general subsequently appealed O’Connor’s decision, paving the way for the 5th Circuit Court of Appeals to rule on the case. Legal experts across the political anticipate that the 5th Circuit will overturn O’Connor’s ruling, thus restoring the ACA, and most expect a decision will be made within the year. However, the federal government’s work on all matters related to the case has come to a standstill due to the partial government shutdown, which has largely closed the Department of Justice.
ACA Enrollment Down for Second Year in a Row
Final enrollment numbers for the federal exchange found that 8.4 million people newly enrolled in, or renewed, ACA coverage for 2019, down about 4% from 2018 enrollment and continuing the trend of declining enrollment under the Trump administration. Of these, about 2.1 million were new enrollees (CMS Snapshot). Additional data will be released in March.
Health Reimbursement Arrangement Rule Comment Period Closes
In response to a proposed rule to expand permissible uses for health reimbursement arrangements (HRAs), health insurance groups urged the Administration to consider safeguards and non-discrimination protections, while highlighting the proposal’s potential to destabilize both the employer-sponsored and individual health insurance markets. An analysis by the Association for Community Affiliated Plans found the proposed rule could increase premiums in the individual market by as much as 83%. The Brookings Institute also released an analysis of the proposed rule with similar findings. The Administration will now consider comments as it works to issue a final rule, though there is no timeline for this action.
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