Source: MSN
Senate Republicans decided Tuesday not to hold a vote on unwinding the Affordable Care Act, preserving the landmark 2010 law for the foreseeable future even as they suggested they may withhold crucial funding for it.
The move leaves the GOP — once again — short of fulfilling a signature promise, which some Republicans worried could inspire a backlash among their base heading into the 2018 midterm elections.
Several senators said they instead plan to move onto other issues now that the party’s latest proposal, authored by Republican Sens. Lindsey O. Graham (S.C.) and Bill Cassidy (La.), had failed to garner sufficient support
“Where we go from here is tax reform,” Senate Majority Leader Mitch McConnell (R-Ky.) told reporters after holding a closed-door policy lunch with members of his caucus.
Meanwhile, Republican lawmakers voiced little interest in shoring up the existing ACA insurance market, sowing apprehension among insurers and state officials just weeks before consumers must start enrolling in plans for next year.
While some GOP lawmakers expected consumers could experience major problems in the months ahead, they argued that the ongoing instability would backfire on Democrats and build momentum for the ACA’s eventual repeal.
“I personally think it’s time for the American people to see what the Democrats have done to them on health care,” said Senate Finance Committee Chairman Orrin G. Hatch (R-Utah). “They’re going to find they can’t pay for it, they’re going to find that it doesn’t work. . . . Now that will make it tough on everybody. Maybe that’s what it take to wise people up.”
Wednesday is the deadline for insurers to sign contracts with the federal government so that they can sell health plans on the ACA marketplaces for 2018. Many companies are hiking these rates by double digits, but they have suggested they would curb such increases if they had assurances that the federal government would provide cost-sharing reduction payments for all of next year. Those subsidies provide discounts to lower-income customers for their health plan’s deductibles and other out-of- pocket costs.
Republican leaders could call on Sen. Lamar Alexander (R-Tenn.) to revive negotiations with Sen. Patty Murray (D-Wash.) on a bipartisan package to stabilize the current insurance marketplaces. The pair had appeared to be reaching an agreement on a plan to guarantee the cost-sharing subsidies for at least a year in exchange for limited waivers to give states more flexibility in how they spend that money. Those talks stalled when Alexander stepped aside to allow GOP leaders to focus on securing votes for Graham-Cassidy.
“I would imagine that Senator Alexander is going to continue to work on that, and hopefully Senator Murray will as well,” said Sen. Roy Blunt (R-Mo.) Tuesday.
At the moment, the Trump administration is only covering cost-sharing payments on a month-to-month basis; a White House official confirmed Tuesday that it had made a payment for September. Asked what the president intended to continue making payments going forward, the aide said officials have not yet decided what to do.
Trump has suggested on several occasions that if a replacement bill does not pass Republicans should let the current system fail, forcing Democrats to negotiate.
It is unclear how much appetite there is for a stabilization bill among Republicans in the Senate, let alone in the House. Aides to House GOP leaders said they did not see a bill providing billions in ACA subsidies as viable in the lower chamber, and that House Speaker Paul D. Ryan (R-Wis.) had conveyed that to GOP senators.
Democrats, meanwhile, reiterated their interest in striking a deal Tuesday, with Murray saying that while “damage has been done” by delaying an agreement, “let’s pick back up right where we left off, and let’s do it right now.”
“The clock is ticking, Democrats are at the table, and I hope Republican leaders will now allow us to get back to work on lowering costs for patients and families and stabilizing the markets,” the senator said. “We don’t have a minute to spare.”
Some congressional Republicans — such as Rep. Carlos Curbelo (R-Fla.), who represents a swing district — echoed that call.
“I think the time for partisan health-care reform has passed, and we should focus on a bipartisan package that provides some regulatory relief, especially on the employer mandate,” Curbelo told reporters, “and also guarantees [cost-sharing subsidies] for the most vulnerable people.”
Lanhee Chen, a research fellow at the Hoover Institution, said in an interview that he had initially hoped the Graham-Cassidy bill would have allowed Republicans to move past their policy divisions on health care.
“I thought at least every Republican, or every conservative, would agree with the idea that when it came to health care, it would make sense to give states the freedom and flexibility to pursue a path that would work best for their residents,” said Chen, who also directs domestic policy studies at Stanford University’s public policy program. “That was a principle I was pretty certain could garner the vast majority of Republicans in the Senate.”
But even that sort of consensus seemed elusive, Chen said, and the fact that Republicans are rushing to pass the bill by the end of the month has produced “a flawed process” that has allowed some critics to sidestep more serious questions, such as the long-term sustainability of the Medicaid program.
Speaking to reporters Tuesday, Trump said he was “disappointed in certain so-called Republicans” who would not back the Graham-Cassidy bill.
The president declined the speculate Tuesday morning on whether he wanted lawmakers to actually vote on the measure, saying, “We’ll see what happens.”
“It’s going along and at some point, there will be a repeal and replace,” Trump added. “But we’ll see whether that point is now or whether it will be shortly thereafter.”
Two GOP senators — Rand Paul (Ky.) and John McCain (Ariz.) — already had come out last week against the measure and were not swayed by a new draft that emerged after the weekend. Monday evening, after the Congressional Budget Office projected that “millions” if Americans would lose insurance if the Graham-Cassidy bill was enacted, Sen. Susan Collins (R-Maine) announced that she could not support it.
Republicans hold a 52-to-48 advantage in the Senate; they can lose only two votes from their party and still pass legislation with the help of a tiebreaking vote from Vice President Pence.
A fourth Republican, Sen. Ted Cruz (Tex.), indicated through his aides Monday that he would not back the bill in its current form because it would not go far enough in repealing the 2010 law.
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Source: MSN

A last-ditch Republican effort to repeal Obamacare picked up steam on Monday as a key senator opened the door to supporting the bill, which is popularly known as Graham-Cassidy.

The GOP got a boost when Sen. John McCain, R-Ariz., who was one of three Republican “no” votes in July that derailed the last GOP health care effort, said he might “reluctantly” vote for the bill if his governor supported it.

Arizona Gov. Doug Ducey, a Republican, backed the legislation later that day. McCain has yet to take a solid position on the measure and has said he prefers a longer bipartisan approach. The Senate Finance Committee announced it would hold a hearing next week on the bill, which could help address his complaints about the rushed process.

Democrats and health care advocacy groups opposed to the legislation, which include AARP and the American Heart Association, are taking the latest Republican push very seriously.

Republicans lawmakers face a tight deadline to get it done: They can only pass the bill using budget reconciliation, which lets them bypass a Democratic filibuster, if they vote before September 30.

Here’s what you need to know about what the new GOP health care bill does, where senators stand, and what would have to happen for it to pass.

What’s in the bill?In many ways, the bill is the most sweeping proposal yet. It would do away with Obamacare’s Medicaid expansion, subsidies for private insurance, eliminate the requirement that Americans have insurance under the Affordable Care Act, and payments to insurers to reduce out-of-pocket costs.

In their place, it would offer states a new block grant they could use to spend on health care mostly as they saw fit. But the block grant would include less total federal spending, meaning states would struggle to cover the same number of people.

How much states would get would depend on a new formula that would cut funding for some states and potentially raise it for others. It would slash the most from large blue states that spend more on health care, like New York and California, and redistribute it to poorer red states that spend less, like Texas and Alabama. Smaller states that rely on Obamacare’s Medicaid funding, like Kentucky and Alaska, could be hit hard as well.

In effect, the bill would open up all 50 states to major health care changes depending on their approach. Some might loosen protections on pre-existing conditions by allowing insurers to charge sick patients more or drop requirements that insurers cover certain essential health benefits. States also would not be required to focus their spending on low-income residents, who were the largest beneficiaries of Obamacare.

Other features are common to Republican repeal-and-replace bills: Traditional Medicaid would face new per-person caps on spending and would likely grow at a slower rate than under current law. The bill would also repeal Obamacare’s requirements that individuals buy insurance and employers offer it. It would also cut off funding to Planned Parenthood.

How many will be covered? Cost?There isn’t a detailed estimate yet and the senators, if the vote on it, won’t see one either. That’s because the Congressional Budget Office, a nonpartisan agency that reviews legislation, announced on Monday that it would not be able to complete a full study by September 30.

When the CBO looked at previous GOP bills that scaled back Medicaid funding and imposed caps on future spending, however, it estimated major losses from those policies alone. The CBO also predicted that loosening protections on pre-existing conditions would cause some insurance markets to become unstable and significantly raise costs for certain medical treatments while lowering premiums.
Who could stop it?That’s hard to answer. The Senate Republicans can only lose two members.

McCain’s position is unclear and Sens. Susan Collins, R-Maine and Lisa Murkowski, R-Alaska, the other two Republican who voted with McCain against GOP “skinny repeal” health care bill, have been highly critical of Medicaid cuts. Collins and Murkowski also opposed defunding Planned Parenthood, which Graham-Cassidy would do as well.

Neither Murkowski nor Collins have taken a decisive position on Graham-Cassidy, but they are likely to be tough gets based on their many concerns with prior repeal bills. Collins said she had a “number of concerns” with the bill, including its Medicaid changes, in a statement on Monday.

“Medicaid was probably the policy area that was the most sensitive in the Senate,” said Joe Antos, a scholar at the American Enterprise Institute.
Graham-Cassidy also has at least one strong “no” vote from the right from a lawmaker who had supported “skinny repeal.” Sen. Rand Paul, R-Ky., has gone on a public rampage against Graham-Cassidy in recent days, which he says doesn’t go far enough in repealing Obamacare.

Meanwhile, Sen. Lamar Alexander, R-Tenn., who chairs the Senate HELP committee, is currently making progress on a bipartisan health care bill with modest Obamacare tweaks. If Graham-Cassidy fails, it could be a fallback option.

Many Republicans are still undecided on Graham-Cassidy and prior repeal attempts have attracted some surprising holdouts in crunch time. Already, some conservatives have said they’re worried the bill would open the door to liberal states enacting single-payer health care programs, which could provide another reason for them to oppose it.

On the other hand, Republicans have been hammered — including sharply by President Donald Trump — for failing to produce a health care bill after years of promises to repeal and replace Obamacare. That pressure could prompt holdouts to take a chance on the bill.
If the measure does pass the Senate, it would have to then clear the GOP-controlled House without any changes — and there’s a deadline. After September 30, any new bill would be subject to a 60-vote threshold in the Senate to get past a Democratic filibuster.
​
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One effective way for an employer to provide certain benefits tax-free to its employees, such as health, dental or vision insurance, is through a Cafeteria Plan, as defined under Section 125 of the Internal Revenue Code. The only way for an employer to have a Cafeteria Plan is by preparing a written plan document which meets the requirements of Code Section 125. Failure to have a written document, or failure to operate a Cafeteria Plan in accordance with the terms of Code Section 125, disqualifies the plan as a Cafeteria Plan and results in gross income to the participants. In other words, any participant in the plan will lose the tax favorable status of the benefits that he or should would have otherwise received.

As a comparison, think about an employer who offers a tax-preferred retirement account, such as a 401(k). In order to have a 401(k), the employer must have a written plan document that explains information about the plan. For example, who is eligible, when can contributions be changed, what happens after employment is terminated, can loans be taken from the plan, etc. A similar, but different type of plan document is required when it comes to providing tax-free benefits for health, dental, vision, life, disability and other qualified group insurance products.

Premium Only Plans (POP) can generally be defined as a type of Cafeteria Plan where the only pre-tax benefits available to participants are for those of insurance premiums. If the Cafeteria Plan also provides for other pre-tax benefits, such as a Health Care FSA or Dependent Care FSA, additional plan documents are required.

Because Code Section 125 is complex, it generally requires a third party who is familiar with the tax code to prepare a plan document which meets the Cafeteria Plan requirements. Premium Only Plans are inexpensive and easy to setup and the benefits of pre-tax savings for the employee generally offsets and costs to setup the plan.

For more information and how to setup a Premium Only Plan for $79 (one time fee) - cafeteriaplandirect.com

Small employers (average of 100 or fewer employees on business days during either of the two preceding years) may provide employees with a "simple cafeteria plan." Under such a plan, the employer is provided with a safe harbor from the nondiscrimination requirements for cafeteria plans as well as from the nondiscrimination requirements for specified qualified benefits offered under a cafeteria plan–

- including group term life insurance, 
- benefits under a self-insured medical expense reimbursement plan, and 
- benefits under a dependent care assistance program. 
 
Note: Once the Simple Cafeteria plans have been established, the employer is deemed as having met the small employer requirement until such time as the average number of employees exceeds 200 on business days during any year proceeding any such subsequent year.

Simple Cafeteria Plan – For purposes of the provision, a simple cafeteria plan is a plan that: 

(1) is established and maintained by an eligible employer,
(2) meets prescribed contribution requirements, and 
(3) meets prescribed eligibility and participation requirements.  

Contribution Requirements – To create a simple cafeteria plan, the employer will have to make contributions to provide qualified benefits under the plan on behalf of each qualified employee (without regard to whether a qualified employee makes any salary reduction contribution) in an amount equal to: 

(1) a uniform percentage (not less than 2%) of the employee's compensation for the plan year, or
(2) an amount which is not less than the lesser of 
(a) 6% of the employee's compensation for the plan year, or 
(b) twice the amount of the salary reduction contributions of each qualified employee. 

The requirements of (2) above are not met if, under the plan, the rate of contributions with respect to any salary reduction contribution of a highly compensated or key employee at any rate of contribution is greater than that with respect to an employee who is not a highly compensated or key employee. 

Qualified Employee – Does not include highly compensated or key employees.
Highly-Compensated Employee – Is any employee who: 

(1) was a five percent owner at any time during the year or the preceding year or,
(2) for the preceding year, received compensation from the employer in excess of the inflation adjusted compensation amount of $80,000 ($120,000 for 2015), and, if the employer elects, was in the top-paid group of employees for the preceding year.  The employer can make the election annually, without the consent of IRS.  An employee is in the top-paid group of employees for any year if such employee is in the group consisting of the top 20 percent of the employees when ranked on the basis of compensation paid during such year. 

Key Employee - In general, the term “key employee” (Sec 416(i)) for 2015 (call for other years) means an employee who, at any time during the plan year, is an officer of the employer having an annual compensation greater than $170,000 or a 5-percent owner of the employer, or a 1-percent owner of the employer having an annual compensation from the employer of more than $150,000. 

Minimum Eligibility & Participation Requirements - The minimum eligibility and participation requirements will be met with respect to any year if, under the plan, 

(a) all employees who have at least 1,000 hours of service for the preceding plan year are eligible to participate, and 
(b) each employee eligible to participate in the plan may, subject to terms and conditions applicable to all participants, elect any benefit available under the plan. 

However, an employer will be able to elect to exclude under the plan, employees: 

(1) who have not attained the age of 21 before the close of a plan year (plan may provide for a younger age),
(2) who have less than one year of service with the employer as of any day during the plan year (plan may provide for a shorter period of service),
(3) who are covered under an agreement which the Secretary of Labor finds to be a collective bargaining agreement, if there is evidence that the benefits covered under the cafeteria plan were the subject of good faith bargaining between employee representatives and the employer, or
(4) who are described in Code Sec. 410(b)(3)(C) (relating to nonresident aliens working outside the U.S.)
​

Source: The Mercury News
The California State Assembly on Monday overwhelmingly approved Senate Bill 17, controversial legislation that could soon become the nation’s most comprehensive law aimed at shining a light on prescription drug prices.
The 66-9 vote easily overcame the 41 votes needed to pass, though an earlier vote late Monday afternoon had come up short at 31-6. At that point, the bill was put on call and the voting roll was kept open for less than an hour until the final vote was called.
SB 17, authored by Sen. Ed Hernandez, D-West Covina and co-authored by Assemblyman David Chiu, D-San Francisco, aims to make drug prices for both public and private health plans more transparent.
It would enable health insurers to negotiate lower prices for drugs or, in many cases, replace those drugs with cheaper alternatives, according to its supporters.
“Public anger at rising drug prices has been growing for some time, and Californians expect their government to do something about it,” said Hernandez in a statement afterwards.
“Drug companies threw everything they had at this bill, but the Assembly stood up for consumers. The reason Big Pharma hates this bill so much is that it’s going to work.”
The bill is strongly opposed by the pharmaceutical industry, which deployed legions of lobbyists and paid for full-page newspaper ads leading up to the Legislature’s final votes on the measure, partially out of fear that SB 17 could become a national model and the first major step toward price controls.
On Monday night, Priscilla VanderVeer, spokeswoman for the Pharmaceutical Research and Manufacturers of America, said in a statement that “SB 17 can’t deliver on its empty promises.
“It won’t help Californians access needed medicine or make their costs at the pharmacy counter any lower,” she said. “It won’t even paint a complete picture of prescription drug spending since it only calls for information on list prices rather than the final cost after discounts and rebates.”
SB 17 would require pharmaceutical companies to notify health insurers and government health plans like Medi-Cal at least 60 days before scheduled prescription drug price hikes that would exceed 16 percent over a two-year period. It would also force drug companies to explain the reasons behind those increases.
“After two years of setbacks, I’m thrilled to see SB 17 pass the Assembly,” said Chiu in a statement. “We’re one step closer to lifting the veil on soaring drug prices and identifying meaningful strategies to ensure access to life-saving treatments.”
The bill passed the Senate 28-10 in May, but has since been amended and will need to return to the Senate for a full vote sometime this week. If it passes there, it will be forwarded to Gov. Jerry Brown, who will decide if it will become law.
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Source: The Washington Post
Bill Frist is senior fellow at the Bipartisan Policy Center and former Republican Senate majority leader from Tennessee. Andy Slavitt is former acting administrator of the Centers for Medicare and Medicaid Services in the Obama administration and senior adviser at the Bipartisan Policy Center. They co-chair the center’s Future of Health Care Initiative.
At a meeting in California this spring, we sat down with a number of insurance company chief executives who are major participants in the Affordable Care Act exchanges. They asked us to carry back a message to Washington: Put partisanship aside and end federal uncertainty about support for the ACA; otherwise, they will end up setting premiums higher than necessary or withdrawing from markets across the country.
With only weeks before the exchanges open for business again, Washington has one more chance to take clear action to bring down premiums and help millions of American families.
As a Republican former Senate majority leader and a political appointee in the Obama administration, we have seen firsthand the impact partisanship can have on American families. Millions have benefited from the Affordable Care Act, gaining the security and consumer protections that come from insurance coverage. But at the same time, growing premiums and deductibles and limited competition burden patients in many parts of the country.
It doesn’t have to be that way — so long as Congress can work together and act this month. We recently gathered a group of Democrats and Republicans at the Bipartisan Policy Center — both advocates and critics of the Affordable Care Act — to develop a set of concrete recommendations to address the cost of insurance premiums.
We developed five recommendations that could stabilize the individual health insurance market:
●  First — and most important — Congress should act to cut average premiums by 20 percent nationally. Lawmakers should commit to funding cost-sharing reduction subsidies for insurance companies in the ACA exchanges for 2018 and 2019. These payments reduce the size of deductibles for low-income people and are already accounted for in the federal budget. But the timing of this measure is critical. Congress and the president have only weeks to positively affect next year’s premiums.
●  Second, Congress should establish a targeted fund for states to use to bring down premiums. The cost of insurance for all of us can be affected by even a small number of expensive patients with complex medical conditions. Innovative efforts, as we have seen in Alaska, have demonstrated that this approach works.
●  Third, the federal government should cut its review time for approving state innovation applications in half, to a 90-day maximum. The ACA has provided states — such as Alaska — the opportunity to waive various provisions of the law with local innovations as long as important consumer protections are kept in place. Only two have been approved so far, but many more states have submitted applications, a pattern we hope continues. Done right, these innovations can improve competition and choice and reduce premiums while maintaining important protections.
●  Fourth, Congress should help middle-income consumers manage the size of their deductibles. It can do this by allowing consumers to temporarily increase the amount of money they can set aside for pretax health saving account contributions for 2018 and 2019 to equal the out-of-pocket limits for high-quality health plans.
●  Finally, the federal government should develop alternatives that allow states beginning in 2020 to potentially replace the ACA’s mandate that most individuals buy coverage or face a penalty. The individual mandate plays an important role in keeping premiums low but is also unpopular with the American public. So even while this mandate is enforced, Congress should direct the administration to explore an option similar to one used in Medicare — automatically enrolling consumers in low-cost coverage and providing incentives to enroll on time.
We know that reaching across the aisle to compromise is difficult. No one will get everything they want, and members of both parties may have to agree to things that are distasteful to them.
But if Republicans and Democrats can take even a small public step to work together on health care, Congress and the president have the opportunity to bring the cost of insurance premiums down and make a positive impact in the lives of many Americans. They will also send a strong signal to insurers, states and the American public that they can count on Washington to work for them.
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