Whenever a new discussion erupts about Healthcare Reform, it is important to look at basic intent of the law to understand both the actions and the consequences of lawmakers. This week’s news stories regarding the rejection of Union requests for exceptions to the Affordable Care Act (ACA) were a good example.
When Healthcare Reform was crafted, to put it very simply, lawmakers and the president expected working people to get their healthcare coverage in one of 3 ways:
- Through health plans paid primarily by their employer
- By staying on the plan paid for by their parents, if they were under the age of 27
- Or, if they did not have an employer that paid enough for a conforming health plan, by buying their own plan from the Exchanges and perhaps receiving assistance from the government to help pay the premiums.
There are obviously other scenarios addressed for certain working and unemployed people, but this was the general aim of the ACA in regards to the employed. Although the third option was touted as an opportunity for individuals “not to be tied to their workplace for healthcare”, the crafters were banking on that group, those receiving advance tax credits to assist with premium payments, to be a relatively low number. To make sure of that, certain restrictions were put on participation in the exchange subsidies. Namely, no one who works, or their dependents, can be eligible to receive premium assistance if their employer already offers an approved health plan at work with an affordable employee portion of the premium payment. In addition, if an employee does qualify for premium assistance on the Exchange, the employer will be fined for failing to cover their employees on the right health plans or for not paying enough of the employees’ premium.
Last week, the Unions asked the White House to create exceptions for their Union workers so that they could receive subsidies intended for those buying qualifying health plans on the Exchange to pay for Union Health plans at work. The White House declined this request. Why did the Unions ask for the exceptions? Because the private, Union-only health plans do not qualify for the type of coverage the ACA mandates for workers and it would be very expensive for Unions and employers to provide conforming plans. In addition, the Union Plans will soon be subject to taxes, fees and regulations that are required of all health plans, thus adding millions in costs. It would have been more advantageous to Unions if they could keep their existing plans and have them be exempted from the ACA. The Unions hoped to access millions of tax dollars designated for Exchange plans to allow Union members to pay for their private, Union plans. The White House provided a legal opinion from the Treasury Department stating that there was no lawful way to give in to the Unions’ request.
The Unions also presented their concerns that their workers will lose coverage at their workplaces if their employers cannot afford the plans, or, that workers will lose hours or be laid off. During meetings with Union leaders the White House encouraged Unions to participate in the spirit of Healthcare Reform by offering qualifying affordable health plans to all of their workers. The Federal government very much wants and needs partners to pay for their vision of having most people covered by health insurance while minimizing the costs covered by Federal dollars. So the White House had to say “No” to the Unions.
Patient Protection & Affordable Care Act (PPACA) information discussed in communications is most accurate as of this date. The Department of Health & Human Services may amend or change federal regulations at any time.