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Legislative Update from Blue Cross Blue Shield of Texas

Legislative Update from Blue Cross Blue Shield of Texas 4.50/5 (90.00%) 2 votes

We received the following email update from BCBSTX today and thought we would pass on this useful info:

Health care spending addressed in long-term deficit reduction plans

In a speech Wednesday, President Barack Obama unveiled his deficit reduction plan, which included several measures that seek to address health care spending. According to a White House fact sheet, the President’s plan will build on policies put in place by the Affordable Care Act (ACA) and would save an additional $340 billion by 2021, $480 billion by 2023 and at least an additional $1 trillion in the subsequent decade.

The House Budget Committee released the GOP deficit reduction proposal last week, which President Obama has said he will oppose. Both the President’s and GOP’s proposals have indicated that their deficit reduction plans include Medicare and Medicaid spending cuts.

Federal budget deal targets ACA measures

Late last Friday night, a bipartisan budget agreement was reached to avoid a federal government shutdown. The agreement is now known as H.R. 1473. If H.R. 1473 becomes law, it would continue to fund the federal government through the end of the fiscal year (Sept. 20, 2011), and according to the latest Congressional Budget Office’s estimate, would cut between 20 to 25 billion dollars in spending over the next 10 years.

The package went to Congress for passage this week as H.R. 1473. The bill was passed by both the House of Representatives and Senate yesterday. It now goes to the White House for the President’s signature.

The budget agreement contains several provisions that would affect the ACA. Most notably, H.R. 1473 would:

  1. Eliminate ACA’s Free Choice Voucher program
    H.R. 1473 repeals the health benefits exchange-related Free Choice Voucher program that would have allowed employers to provide vouchers for eligible employees to use in purchasing health insurance coverage on a health exchange beginning in 2014. They are different from the premium tax credits and cost-sharing subsidies that will be provided by the federal government to individuals purchasing health insurance coverage on a health exchange.
    Proponents of the Free Choice Vouchers believe that the vouchers provide eligible employees with more choice and flexibility, increase competition, and reduce costs. Opponents believe they are too costly for employers, especially those that offer both low-cost and high-cost coverage, or employ large numbers of younger employees who do not make large salaries. They also say the vouchers have the ability to create adverse selection, which could increase employer costs.
  2. Reduce $2.2 billion in funding for ACA’s CO-OP Program
    The Consumer Operated and Oriented Plan (CO-OP) program of the ACA directs the federal government to support the creation (through issuance of federal loans and grants) of member-owned, nonprofit insurers (CO-OPs) that will offer qualified health plans on the exchanges and possibly in the off-exchange individual and small group markets. Some $2.2 billion of the $6 billion in appropriated budget for the (CO-OP) will be permanently cut.
  3. Require auditing, reporting on various aspects and effects of ACA
    H.R. 1473 directs the General Accounting Office, the federal government’s “watchdog” over how taxpayer money is spent, to issue a report on ACA implementation; to perform an audit of requests for essential health benefit annual limit waivers; and to audit the comparative effectiveness research funding (comparing the effectiveness of different treatments for the same illness).
    In addition, the bill directs the Chief Actuary of CMS to conduct an actuarial analysis of projected premium impacts as a result of a number of the ACA provisions, including guaranteed issue, guaranteed renewability, and community rating.

President Signs Repeal of ACA’s 1099 Reporting Requirements

Thursday, President Obama signed H.R. 4, which repeals the expanded 1099 reporting requirements included in the ACA. As we previously reported, the Senate approved the measure on April 5, and the House approved it on March 3.

The new reporting requirements would have compelled businesses to file a Form 1099 for all payments of goods and services aggregating $600 to a single payee, including corporations.

Repeal of the expanding requirements is expected to reduce revenue by $24.7 billion from 2011 to 2021. H.R. 4 offsets this cost by requiring recipients of the premium assistance tax credits included in ACA to repay a greater share of any overpayments of the tax credits.