Direct Link from Hewitt.com:
Congress made history on Sunday, March 21, 2010, when the House passed both the Senate-passed health care reform bill and changes to the Senate bill embodied in a separate budget reconciliation bill.
The reconciliation bill, the “Health Care and Education Reconciliation Act of 2010″ (H.R. 4872), includes significant modifications to the Senate-passed “Patient Protection and Affordable Care Act” (H.R. 3590). The reconciliation bill changes (only) now go to the Senate for its consideration early this week. For the reconciliation bill to pass the Senate, it would require a simple majority vote (51 votes) under the budget reconciliation rules, with Vice President Biden available to break a tie.
Senate Democrats aim to complete the reconciliation bill before the Senate adjourns for spring recess, slated to begin March 29 (unless delayed). Now that the House has passed the reconciliation bill (H.R. 4872) and the Senate-passed bill (H.R. 3590) on the same day, President Obama is expected to sign the “Patient Protection and Affordable Care Act” (H.R. 3590) into law as soon as possible.
The Hewitt bulletin linked to at right provides a preliminary analysis of the employer impact associated with the reconciliation bill (H.R. 4872), including certain changes to H.R. 4872 adopted via House passage of the Manager’s Amendment.
Summary of Bill:
The Senate bill, which is estimated to cost $940 billion over the next ten years, would create state health insurance exchanges for the purchase of health insurance coverage and would insure an additional 31 million currently uninsured Americans. Some of the high impact items of the Senate bill for employers are as follows:
Employers would be subject to a “free rider” penalty, under which employers with at least 50 full-time employees would pay a penalty if a full-time employee receives a federal subsidy to purchase health insurance in the exchanges. The penalty would be assessed if the employer does not offer health coverage at all, if the employee is offered coverage that is considered “unaffordable,” or the plan has an actuarial value of less than 60 percent.
A 40 percent excise tax would be imposed on the aggregate value of health coverage offered by employers if that value exceeds a certain threshold.
Employers that offer health care coverage and make a contribution toward the cost of the health care coverage would have to provide “free choice vouchers” to qualified employees for the purchase of qualified health plans through the exchanges.
Employers would be required to report the annual cost of health care coverage received by their employees.
Employers with more than 200 employees would have to automatically enroll new full-time employees in health care coverage (subject to any waiting period authorized by law).
A $5 billion fund would be created to finance a temporary reinsurance program to help employers offset the costs of expensive health claims for retirees ages 55–64 and their families.
Annual contributions to employer-provided health care flexible spending accounts (FSAs) would be capped at $2,500 (indexed) and reimbursement of over-the-counter medicines would be limited to those that have a prescription.
Employers receiving the Medicare Part D Retiree Drug Subsidy would have to include the payment in income for tax purposes.
An additional Medicare tax of 0.9 percent would be imposed on individuals receiving wages in excess of $200,000 (single taxpayers) or $250,000 (couples). The tax would be imposed only on the employee portion of the Medicare tax, not on the employer portion.