Health care remains at the top of the agenda for the 112th Congress, with the House of Representatives making one of its first actions a measure to repeal the reforms. Signed into law just last year by President Obama, changes to health care legislation are very much under discussion. And while Senate Majority Leader Harry Reid (D-Nev.) has indicated he would not allow a floor vote in the Senate on an outright repeal measure, there are more modest proposals that may be successful.
January’s repeal vote was the first salvo in the Republican’s long-term strategy to roll back last year’s health reforms officially known as the Patient Protection and Affordable Care Act and subsequently amended by the Health Care and Education Reconciliation Act of 2010. Many Washington insiders do not expect Congress to pass a full repeal nor would the President be expected to sign such a measure.
With a number of different proposals being presented regarding changes to health care reform, we need to look at the broad health care debate in Congress, where it stands, and what can we expect to see Congress address over the next two years.
The country is divided on health care reform. Some like the reform, some oppose the reform, and some believe the reforms did not go far enough. There is bipartisan agreement that several key issues need to be addressed and AH&LA will work with Congress to address these concerns.
From the perspective of the business community, there are many problems with the current legislation and we need to focus on specific reforms. AH&LA has listened to the industry to determine which issues are most important and need redress from Congress.
Foremost among bipartisan supported issues is the need for the IRS Form 1099 Tax Reporting mandate to be repealed. Last year’s law included a measure requiring all businesses to file a Form 1099 for every business-to-business transaction, good, or service over $600 a year. For a hotel, this could be generated by buying new guest towels, hiring a landscaping company, purchasing pool chemicals, or many other routine events. This is a massive paperwork burden, particularly for small businesses.
Both Democrats and Republicans support repeal of this mandate; however, there is disagreement on how to pay for it. Repealing this measure would result in a loss, at least on paper, of federal income. Members are currently looking for cuts elsewhere to balance this loss and make it what we call in Washington “revenue neutral.” There is a strong likelihood that this requirement will be repealed.
AH&LA has heard from many members who have used Health Savings Accounts and Flexible Spending Accounts as a means to provide health care benefits to their employees. Businesses appreciate the flexibility it provides employees, allowing them to make their own health choices. Last year’s reform inexplicably limits the use of these accounts by businesses. AH&LA will continue to work with other industries to seek a restoration, and even expansion, of HSA and FSA accounts for our members.
Other provisions supported by AH&LA members will face a more difficult path to passage.
Many members rely on part-time and/or seasonal employees to help run their businesses. Some businesses would literally shut down without these workers. Many of these employees get health care through their parents or schools. However, these businesses may find themselves on the hook for the full $2,000 per employee penalty if they do not provide health care coverage. The law exempts employers from paying for the benefits of seasonal workers hired for 120 days or less in small businesses (50 or fewer employees). This exemption includes those covered by the Labor Department’s definition of seasonal worker and “retail workers employed exclusively during holiday seasons.” This provides very little coverage for our industry and AH&LA will continue to work toward a reasonable exemption for seasonal and part-time employees.
Also high on the agenda for our industry is the ability to offer insurance plans across states lines for multi-state employers. This has been an issue long advocated by AH&LA and would allow small businesses to pool their purchasing power to secure affordable health coverage. Currently, only large businesses and unions are able to meet the minimum standards to offer coverage. AH&LA continues to urge Congress to allow multi-state purchasing either directly by businesses or through an association.
There are a number of additional issues our industry is concerned with that will be addressed by Congress. For example, in the new law there are tax increases on businesses and individuals, mandatory insurance reforms that force insurers to raise prices today, as well as employer and individual mandates.
Fixing health care reform will take years. It is safe to say that the reforms passed last year by Congress will see numerous changes, both large and small, over the next few years. AH&LA will continue to be your advocate during this debate. We encourage you to follow our alerts, advisories, web postings, webinars, and meetings, while staying engaged with your local members of Congress.
