Health Care and Employee Benefits Policy: What to Watch for in 2019

Health Care and Employee Benefits Policy: What to Watch for in 2019

This could be a big year for health care and employee benefit policy developments.  Here are some of the issues Kistler Tiffany Benefits will be watching in the year ahead so that we can provide you with up-to-date information on any legal, legislative or regulatory actions that might impact your business.

Federal Court Action

Texas v. The United States, which challenges the validity of the Affordable Care Act (ACA) now that there is zero penalty for violating the law’s individual mandate provisions, has our attention.  A lower court found the whole ACA unconstitutional on December 15, 2018, but the presiding judge stayed his ruling so the entire ACA will remain in force during the appeals process.  The Department of Justice and the states defending the ACA have filed appeals with the United States Fifth Circuit Court of Appeals, and it could take up to two years to conclude the judicial action, with the Supreme Court possibly being the ultimate arbiter of the case.  Meanwhile, the state of Maryland has filed a contrary suit asking the judicial branch to either find the ACA constitutional and enforceable or declare the segment of the Tax Cut and Jobs Act that zeroed out the individual mandate penalty unconstitutional. No matter what happens in either of these cases in 2019, all compliant health coverage will carry forward, and all ACA requirements for employers, individuals, and health plans will remain unchanged for the foreseeable future.

In addition to the two blockbuster cases, quite a few other matters are working their way through the federal court system that could have a bearing on employer-sponsored health plans.  Two groups of states have filed separate cases challenging the Trump Administration’s regulations allowing employers and individuals to claim religious or moral exemptions to the ACA’s preventive care requirements regarding contraception.  Additionally, a group of 12 states is opposing the 2018 federal regulation that expands the availability of association health plan options for employer groups, and a group of consumer advocates and safety-net health plans have sued the Trump Administration over the new regulation allowing for access to short-term limited duration health insurance for up to 364 days. Decisions on any or all of these matters could impact coverage options for businesses in our service area, so Kistler Tiffany Benefits is monitoring them closely for our clients.

Federal Legislative Action

With health care consistently ranking as one of the top issues on the minds of American voters, Congress cannot ignore it in 2019.  Given the divided state of the federal government, we expect an issue with bipartisan appeal to take center stage—lowering the cost of prescription drugs.   Congress will most likely attempt to bring more competition to the marketplace by acting on a measure to prevent drug manufacturers from paying generic drug companies fees in exchange for a promise to cease the marketing of their less expensive drugs.  They could also take up the bipartisan CREATES Act, which would prevent drug companies from guarding their brand-name drugs so that competitors cannot develop alternatives as easily.

Beyond measures aimed at drug prices, we expect the opioid crisis and mental health care to remain a focus of federal legislators.  The House of Representatives may take action on measures to preserve and strengthen the ACA, but it is unclear how those bills will be received in the Senate.  Bipartisan measures aimed at some of the ACA’s more unpopular taxes and fees could have the best chance of success.

As the 2020 Presidential election approaches, we predict “Medicare for All” discussions will gain more traction.  However, given that there is virtually no agreement amongst Democrats about what this phraseology means (let alone the ideal financing and structure to support large-scale national coverage program for all citizens), we do not believe any substantive federal action on this matter will take place in 2019.

Federal Regulatory Action

The executive branch has wide-ranging authority over health insurance and employee benefit plans, and the Trump Administration plans to take advantage of it.  A regulation on new employer health reimbursement arrangement options should be finalized in 2019.  Additionally, the Equal Employment Opportunity Commission plans to release new rules this summer on the intersection of employer-provided wellness programs and the Americans with Disabilities Act and the Genetic Information and Nondiscrimination Act.  The Administration is currently looking into changing existing HIPAA/HITECH rules on the privacy and security of protected health information and data, with the goal of modernizing the rules.  A big item on the Department of Labor’s proposed agenda is a revamp of the federal overtime rule, which is projected for a March release.  The Treasury Department has the release of new proposed regulations on the pending excise tax on high-cost health plans scheduled for September.  The excise tax, which is more commonly known as the “Cadillac tax,” is not slated to go into effect until January of 2022, but it is possible that Congressional action could delay or eliminate the tax, negating the need for additional regulation.

State Policy Action

Finally, given that the individual states are the primary regulators of the business of insurance, Kistler Tiffany Benefits will continue to keep tabs on the actions of state legislatures and insurance commissioners in our service area.  Just in the past year, New Jersey acted on a state-specific individual mandate, balanced billing, and new sick leave requirements, and during the coming year, we expect policymakers in all states we serve to examine how they will support health insurance markets in response to new federal rules and requirements.