HRPA Pushes Congress to Strengthen Employer-Sponsored Health Care in Lame Duck

The Association joined the business community in several letters urging Congress to prioritize strengthening employer-sponsored health care in the lame duck session rather than waiting until the new year. The letters touched on the following issues:

Oppose tax cap: With GOP gains in Congress and the White House, and renewal of the 2017 tax cuts expected to require revenue offsets, proposals to cap the federal income tax exclusion for employer-sponsored health care benefits could gain traction next year.

• Our letter outlines key employer concerns including that “Group coverage would fall as younger, healthier adults migrate out of employer-based plans…and employers will have to consider passing on higher premiums to employees as well as reconsider whether to maintain additional resources meant to help navigate care and coverage.”

PBM Reform: Over 100 organizations joined together to urge Congress to pass PBM reform before the end of the year.

• Our PBM letter highlights transparency provisions which will allow employers to better negotiate their prescription drug plans and lower costs including requiring 100% pass-through of rebates and other payments to employers and patients.

Flexibility for Direct Primary Care: HRPA joined with others to promote changes to the tax code allowing employees with HDHPs and HSAs to use direct primary care services.

• These arrangements allow employers or patients to pay a monthly flat fee for primary care services.

• A Milliman study found that direct primary care services reduce costs for employers and patients, with employers that offer such services experiencing 40% fewer hospital visits and almost 20% lower cost claims.

The bottom line: With the GOP controlling both chambers of Congress and the White House in 2025, Republicans are likely to wait until next year to push reforms rather than raising reforms during the lame duck session.

• The slim majorities in the new Congress means that lawmakers may be more likely to negotiate on issues like PBM reform and transparency which have significant bipartisan support.

• Newly elected Senate Majority leader, Sen. John Thune (R-SD), has also actively advocated for telehealth extensions and PBM reform.