Posted by: danielrashke | March 19, 2010

After a Lull Healthcare Reform Heats Up Again

Early on I predicted that some form of legislation would be passed on healthcare reform, however, I was expecting it to take place in the second half of the President’s four year term. I figured the economy would take a little quick up-tick and the Democrats would be settled into the driver’s seat for a while. For various reasons this legislation will come sooner than I thought. As previously stated, the Senate passed a healthcare reform bill and it was done with the sixty votes needed. After months of strategic and tactical discussions, H.R.4872, the Healthcare Reform Reconciliation Bill, was posted on-line at 2:20 p.m. Thursday, March 18, 2010. That started the 72-hour clock ticking—the time Congressional leadership promised for review of the bill prior to a vote. Thus, a vote in the House could come no earlier than Sunday afternoon (March 21, 2010). Whether the House will vote that soon remains to be seen. Expect some changes to the language. Presently, there are not 216 publicly committed “yes” votes in the House. Thus, the vote could be delayed past Sunday afternoon.

The process will require the House to enact into law H.R.3590, the Senate health reform measure, before the Senate votes on the changes to H.R.3590 contained in H.R.4872. Thus, anything in H.R.3590 not changed in H.R.4872 would become law as drafted in H.R.3590. An example of this would be the Simple Cafeteria Plan provisions under Section 9022 entitled “establishment of Simple Cafeteria Plans for small businesses.” Changes in the Reconciliation Bill that relate to our customers and TASC include the following:

  • High Value Health Insurance Tax Threshold and Timing: The bill delays until 2018 the high value health insurance tax. This tax is a 40 percent tax, payable by the insurer or–where the plan is a self-insurance plan or for purposes of Flexible Spending Accounts (FSAs)–by the plan administrator or employer. The bill includes an increase in the threshold at which the high value health insurance tax is triggered. The new thresholds would be $27,500 for family coverage and $10,200 for individual coverage (higher thresholds—$39,950 and $11,850 respectively—would apply for those in high-risk occupations). The threshold amounts are indexed. Stand-alone dental and vision coverage would not be included in the calculation of the total value of health insurance.
  • FSA Limitation: The new $2,500 annual limit (indexed) on FSAs would be delayed by two years, to 2013.


Both the Rules Committee and the House floor vote could take place on Sunday, March 21. President Obama will delay travel and be on hand for the House vote. The tactics used for getting the bill(s) passed does not seem to be public yet. House Democrats are considering using a self-executing rule, also called “deem and pass,” that would deem the underlying Senate healthcare bill passed once the reconciliation package is passed.

TASC and our industry will remain committed to trying to steer legislation that makes sense for its customers. This is a difficult task. In addition, TASC will continue to inform customers through channels like the CEO Blog, Client Alerts, etc., and will make every effort to help customers understand the impact of the changes. TASC will move our organization and services in line with customer need. Overall, the legislation is manageable related to TASC’s relationship and services with and to customers. Disregarding the “politics,” we expect the outcome of these bills to be acceptable to TASC, to our representatives, and to our Clients.

On a separate note, but related to TASC and our customers, the Hiring Incentives to Restore Employment (HIRE) Act was enacted into law on Thursday. This is the “Jobs” Bill. Originally there were provisions for another extension of COBRA in the Bill.  However, at the last moment Senator Harry Reid stripped those provisions because he wanted the bill not to lose its message or intent with respect to jobs.


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