Washington DC - Last week, on June 22nd the United States Senate released a discussion draft of the Better Care Reconciliation Act (BCRA) in an effort to repeal parts of the Affordable Care Act (ACA). So what's the latest?
The BCRA is the most recent alternative to the ACA, which follows the American Health Care Act (AHCA) passed by the House in May. Senate Republican leaders will attempt to schedule a vote on the BCRA in early July after the holiday recess if the bill garners sufficient Republican backing.
Senate Republicans need a majority of 51 votes to pass the bill, a seemingly easy task considering that there are 52 Republican Senators. In the event of a tie, the Vice President is eligible to cast his vote.
While the BCRA mirrors the AHCA in many ways, there are several key differences. Most are a result of special rules put in place for budget reconciliation used in the Senate, such as the requirement that every provision within the bill has a direct budgetary impact.
Comparing the BCRA and AHCA
BCRA and AHCA Similarities
- Both repeal individual and employer mandate penalties
- Both end enhanced funding for Medicaid expansion
- Both expands individual market age rating band
- Both repeal most ACA fees and taxes
- Both delay the Cadillac Tax to 2026
- Both incent continuous coverage
BCRA and AHCA Differences
- The BCRA adds age and geography adjust components to current income based subsidiaries
- The BCRA maintains protection for pre-existing conditions
- The BCRA establishes Association Health Plan rules (called Small Business Health Plans)
What does this mean for Employers?
- Repeal of the individual and employer mandate penalties
- Delay of Cadillac Tax to 2026
- States will define Essential Health Benefits
- More flexibility in using and contributing the Health Savings Accounts (HSAs) and Flexible Spending Accounts (FSAs)
In Conclusion
The BCRA will include a transition period of a few years before some provisions become effective, while others will be put in place immediately. The BCRA will not impact all current ACA provisions, meaning that employers will need to comply with both new law and the retained sections of the ACA. Until new guidance is issued, ACA compliance is required.
Hopefully this post brought you up to speed on what's going on in the senate and the comparison between BCRA and AHCA differences and similarities.
