united-states-2361405_1920You’ve probably heard by now that the U.S. Senate voted 49-51 to reject the Health Care Freedom Act (HCFA), the GOP’s “skinny” version of a bill intended to repeal and replace the Affordable Care Act (ACA). While it may be reintroduced at some point, this ultimately ends their current efforts to do away with the ACA.

How does this affect me?

As you may recall, the proposed legislation was a budget reconciliation bill designed to suppress certain provisions of the ACA by eliminating penalties, reallocating federal spending, and altering taxes and exemptions.┬áSince it didn’t pass, the ACA remains current law. Consequently, employers must continue to comply with all of its provisions.

The two biggest take-aways for employers and individuals are this:

  • Large employers will continue to face penalties for failure to offer acceptable health coverage to their full-time employees.
  • Individual mandate penalties will still apply for anyone who does not carry acceptable health coverage (unless they qualify for an exemption).

 

 

It’s also important to note that an executive order, signed by President Trump on January 20, 2017, intended “to minimize the unwarranted economic and regulatory burdens” of the ACA law–until it could be repealed and replaced–does not change any existing regulations. While this order directed several federal agencies to take steps to relieve provisions of the ACA that might impose a financial burden, it didn’t address any requirements specifically. The IRS has issued several information letters to clarify this issue.

What happens now?

Because the Senate was unable to pass any bill to replace the current legislation, the ACA is still intact. Penalties are in affect for individuals and employers who do not comply with its provisions. After the vote, Senator McConnell said Republicans plan to focus on other legislative issues for now, although they’re still committed to repealing the ACA.

The Senate has the option to reintroduce the HCFA at some point in the future or pursue its own means of repealing and replacing the current legislation. If you have questions about the current requirements and penalties and how they affect you or your business, please give us a call today! In the meantime, we’ll keep you updated on future developments as they happen.