Bipartisan Health Care Bill Faces Significant Challenges

Federal Health Care Reform

Senators Lamar Alexander (R-TN) and Patty Murray (D-WA) introduced their bipartisan health care reform bill aimed at stabilizing the individual health insurance market, with both members open to improving the bill and Sen. Alexander predicting the agreement "will become law in some fashion before the end of the year."  The bill has 24 bipartisan cosponsors and, assuming all Democrats vote for it, will have the 60 votes needed to pass the Senate.  However, the bill still faces serious challenges as both President Trump and House Speaker Paul Ryan (R-WI) have called for changes to the measure that could alienate Democratic support.  To pass Congress, the bill would likely need to be attached to legislation authorizing new funding for the Children's Health Insurance Program (CHIP) or some end-of-year appropriations bill.  While the bill would not directly impact employers, it would:

• Fully fund the HR Policy-supported cost-sharing reduction (CSR) subsidies through 2019;
• Enable individuals over age 30 to purchase catastrophic health care plans in the ACA exchanges;
• Give more flexibility to states seeking Section 1332 waivers, including authorizing funding for reinsurance; and
• Require HHS to spend $106 million on outreach and enrollment in 2018 and 2019.

Separately, Sen. Ron Johnson (R-WI) is writing a conservative alternative to the Alexander-Murray bill that would also fund the CSR payments, but it will complicate the passage of any ACA reform measure.  With open season for the ACA exchanges less than two weeks away and a potential government shutdown looming in December, odds are Democrats will insist on funding the CSR subsidies and ACA outreach activities in any omnibus appropriations bill, and they may very well succeed.