House Begins Consideration of Health Care Legislation

This week, the House of Representatives will embark on what is widely believed to be the final sprint to health care reform. The House Budget Committee is scheduled to begin markup of a reconciliation bill (pdf) on Monday afternoon.  This 2,309-page bill – the Reconciliation Act of 2010 – is expected to be the vehicle for changes to the Senate-passed health care bill, the Patient Protection and Affordable Care Act (H.R. 3590), negotiated between the White House and House and Senate Democrats. The reconciliation bill also includes changes to the federal student lending program that would switch the program to direct federal loans.

After the loss of a 60-seat Democratic supermajority in the Senate, Democratic Congressional leaders are turning to the budget reconciliation process to complete health care reform. Because it is in the form of a budget reconciliation measure, the Senate would need only a simple majority to approve it. Although the reconciliation bill currently contains many of the elements – including the public health insurance option – from the House-approved Affordable Health Care for America Act (H.R. 3962), these provisions are expected to be deleted and replaced with the agreed-upon compromise language. In a series of parliamentary maneuvers, a House vote on the Senate-passed Patient Protection and Affordable Care Act and on this reconciliation package could come by the end of the week.

It is all but assured that no House Republicans will vote in favor of the Senate health care bill, so Democrats are scrambling to shore up the minimum 216 votes needed for passage. Assuming the House has the necessary votes to pass the Senate bill and the reconciliation measure, the reconciliation measure would also have to be approved by the Senate.

Photo credit:  MBPHOTO, INC.

Healthcare Reform May Include Employer Incentives for Wellness Programs

Legislation providing employers with various incentives for promoting employee health may receive serious consideration now that Congress is contemplating major healthcare reform. A recent article published in The New York Times claims that proposals such as the Healthy Workforce Act (H.R. 1897, S. 803), which would provide employers with a tax credit for 50 percent of the costs incurred in implementing “effective and comprehensive” employee wellness programs, could be incorporated into broader healthcare reform. The article also claims Congress may loosen legal restrictions to enable employers to use monetary rewards or penalties to encourage healthy lifestyles.

While many employers currently offer some form of wellness plan or benefits, doing so must be done with care. As the NYT article emphasizes, employers need to be mindful of tax, labor, and insurance laws when implementing such incentive programs. Paid gym memberships, for example, may count as an employee’s taxable income. Moreover, employers must take care not to discriminate on the basis of an employee’s health status or medical history. Critics also argue that the carrot and stick approach to promoting employee wellness may constitute a form of lifestyle discrimination, and could amount to an invasion of privacy. The proposals floating around Congress seek to remove some of these legal landmines to make it easier for employers to establish wellness programs. Given that one of President Obama’s eight principles for health legislation is that it must “invest in prevention and wellness,” such proposals are likely to receive attention in the coming months.  For additional employment law issues associated with wellness initiatives, see Littler’s Report Employer Mandated Wellness Initiatives: The Continuum from Voluntary to Mandatory Plans.

Health Care Bills Continue to Be Introduced

During the White House Forum on Health Reform last week, President Obama expressed his desire for an overhaul of the nation’s health care system. But he would leave the details of this overhaul, however, up to the legislature. Therefore, it can be expected that a variety of health care reform bills will flood the docket in the coming months. While the majority of these bills will inevitably die in committee, aspects of these various proposals could be incorporated into a more comprehensive bill that would be expected to receive serious consideration. Democratic leaders have said that they hope to move comprehensive legislation to the House floor before the August recess.

Just last week, two health care-related bills were introduced. The Healthy Americans Act (H.R. 1321) bears resemblance to the Massachusetts mandatory health insurance program, by requiring all adult Americans to enroll themselves and their dependent children in a qualifying health insurance program, which could include an employer-sponsored plan, or could be a universally-available Healthy Americans Private Insurance Plan (HAPI plan).  Employers offering employer-sponsored health coverage plans would be required to ensure compliance with the statutory coverage requirements, and also would be required to distribute to employees standardized information on HAPI plans and supplemental health insurance options provided by the state Health Help Agency (HAA) provided for under the Act. Additionally, the legislation sets forth penalties for failure to enroll, establishes standardized coverage and state options for HAPI plans, ensures portability, and requires the Secretary of Health and Human Services to promulgate guidelines concerning the benefits, items and services to be covered.  Requirements for setting premiums are also outlined in the bill. If enacted, the provisions of the bill would take effect no later than 4 years after the date of enactment. This bill was referred to the House Committees on Energy and Commerce, Ways and Means, Education and Labor, and Oversight and Government Reform.

On the same day the Healthy Americans Act was presented, a bill to amend the Employee Retirement Income Security Act (ERISA) to provide emergency protection for retiree health benefits was introduced. The Emergency Retiree Health Benefits Protection Act of 2009 (H.R. 1322) would accomplish the following:

  • Bar plan sponsors from canceling or reducing health benefits after the dates participants retire;
  • Require sponsors of group health plans to restore health benefits previously taken away from retired participants of such plans to the extent such benefits were canceled or altered after the dates the participants retired, and the plan sponsor would not sustain substantial business hardship by restoring such benefits; and
  • Establish an Emergency Retiree Health Loan Guarantee Program that would provide retiree health loan guarantees to plan sponsors of group health plans. The credit would be used by plan sponsors to help them discharge their obligations to restore health benefits to retirees under the Act.

Violations of this Act would be subject to a civil penalty of up to $1,000 per violation. The Act would take effect on the date of enactment. This bill was referred to the House Committee on Education and Labor.