The Power of A

Yesterday, the Senate Health Education Labor and Pensions (HELP) Committee passed its health care legislation out of committee in a 13-10 vote.  This is the first comprehensive health care bill to be passed from committee in this Congress.  The major differences between the HELP bill and yesterday’s released House bill include: a role for associations as navigators, a definition of small business using number of employees not payroll, and different penalties for the individual and employer mandates.  ASAE has taken a look at the amended legislation (you can see a summary here) and has prepared this quick guide to the affects of the legislation on associations and individuals:

Businesses (Including Associations)

1.  All businesses must provide health insurance to their employees. Those who fail to cover at least 60% of their full time employees’ (FTEs’) monthly premiums are subject to a $750 annual fine for each uninsured FTE, with the first 25 exempted.

2.  Professional and trade associations, unions, and chambers of commerce can contract with their states to serve as “navigators” for the Affordable Health Benefits Gateway (see description under Individual). Associations and other groups would receive federal funding through the states to educate members and the public on how to receive insurance through the Gateway.

3.  The bill raises the federal limit for the amount an employer can reward employees for participating in wellness programs from a 20% premium discount to 30%.

Small Businesses

1.  All employers with fewer than 25 employees are exempt from the employer mandate and are eligible for the program credits described below.

2.  Beginning in 2010, businesses with 50 or fewer FTEs that pay 60% or more of their employees’ premiums would be eligible to receive a tax credit for three consecutive years. The size of the credit would be based on number of employees, types of coverage, and amount of time the employer paid over 60% of the premiums.

Individuals

1.  The bill mandates that everyone have insurance coverage or pay a $750 per year fee.

2.  The bill allows individual states to create Affordable Health Benefits Gateways. These would be insurance exchange mechanisms that individuals and qualified employers can find the right plan for them. If a state fails to establish a Gateway the Department of Health and Human Services can create a Gateway in that state. Gateways can be regional and state-specific.

3.  Low- and moderate-income individuals and families would receive credits to help with purchasing insurance through the Gateway. The credits would be on a sliding scale of up to 400% of the federal poverty level.

4.  The self-employed who do not receive a Gateway-insurance credit are eligible to receive the small business credit for employers with 50 or fewer FTEs.

5.  Individuals would have the option of keeping their current health care plan, shopping for a health care plan outside of an exchange, or shopping for a health care plan within the Gateway in the person’s state. The Gateway would include private and public options.

6.  The age for a dependent to stay on a health insurance plan is increased to 26 years of age.

In addition, details of the soon-to-be-released Senate Finance Committee bill have slowly been released (subscription).  According to reports, the committee bill will not have a public plan, but will instead include language authorizing the creation of health care co-operatives as an alternative to traditional private insurance plans.  In addition, the bill would be paid for in part by a windfall tax on private insurance companies; this idea gained public support from two additional key Senators yesterday.  ASAE will prepare a summary of the Finance Committee bill when it is released, so keep The Power of A bookmarked for the latest information.

Quick Hits

The committee hearing schedule for the House Education & Labor, Energy & Commerce, and Ways & Means Committees… House Republican Leader Boehner’s office releases a chart describing the House bill… the American Medical Association continues its debate internally (subscription) on the public plan… Will the Blue Dogs go along quietly with the Democratic leadership on the House bill?