A new year, a new Congress, a new president, and a new administration all mean compliance changes for employers. In particular, the Republican sweep of the election means that we can expect substantial changes coming out of Washington in the upcoming months and years, including to the Affordable Care Act (ACA). For example, what is the future of the ACA, and what should employers do during this time of uncertainty?
Compliance remains a top priority in this uncertain and very fluid environment, and organizations should focus on continuing to meet all key compliance milestones until definitive changes and their implications are fully known, in place and understood.
Here are four key items we believe should be on every company’s radar:
- Repeal. Republicans are laying the groundwork to repeal key ACA provisions. Many Republicans, including President-elect Donald Trump, are acting quickly to deliver on prominent campaign promises to repeal the ACA. Expect executive action through the issuance of Executive Orders in the opening days of the new administration and legislative action. Right now, it is clear that repeal-oriented action will be taken, but exact details have not been announced and some parts of the ACA will remain.
- Reconciliation. Budget reconciliation is the process Republicans are currently using for the ACA repeal. Reconciliation bills cannot be filibustered and can pass with a simple majority. Consequently, only a partial repeal of the ACA can be achieved through reconciliation, such as elimination of the Medicaid expansion, federal financial support for Exchange coverage, and the individual and employer mandate penalties. Even after a reconciliation bill is enacted into law, Congress must determine what comes next.
- Replace. Republican leaders are saying that they will offer a replacement plan that will take effect after a transition period. During the transition period, the current law will likely remain in place. One of the key points of debate in Congress is how long the transition period should be. There is no consensus on this question yet, but some transition period will be required and employers will likely continue to have reporting and other ACA responsibilities. ACA replacement will be complex and require legislative action and bipartisan cooperation. Practically, it is unclear how soon a detailed replacement plan can be ready to be considered by Congress despite recent calls for simultaneous repeal and replacement.
- Relax. Admittedly, “relax” isn’t part of the ACA vocabulary, but ADP’s team of experts has you covered as Congress and the new administration continue to work through the complex policy and political ramifications of deciding what’s next for the ACA and Health Care Reform. Employers in the meantime should continue to comply with existing requirements and stay informed.
The news cycle continues to accelerate rapidly. In addition, some of what is reported in the media is surface-level or incomplete, making it understandably difficult for busy business leaders to keep up with the facts on important issues much less determine what must be acted upon and when vs. what is not ready for action. To help you during this time of significant transition in Washington, we’ll be providing updates on a regular basis.
For example, if you have not yet done so, please register for our two upcoming webinars New Year, New Changes to HR and Tax Compliance and Employment & Benefits Trends and the New Administration (11AM EST or 3PM EST) scheduled for January 31, 2017 and February 15, 2017 respectively. Also, please sign up for the always informative ADP Eye on Washington at www.adp.com/eyeonwashington. Lastly, please continue to look out for updates such as this which we will provide as changes break or to periodically keep you informed on Washington transition activities.