Health Care Developments: House Plans Vote on ACA Bill, IRS Proposes to Expand HRA Uses

June 12, 2020

The House plans to vote before the July 4 recess on a package of Affordable Care Act measures to make exchange plans less expensive and encourage more states to expand their Medicaid programs while the IRS has proposed to allow employees to use health reimbursement arrangements (HRAs) to directly contract with primary care physicians.

House Speaker Nancy Pelosi (D-CA) told reporters that an “Affordable Care Act stabilization” bill, which could include expanded ACA insurance subsidies and other measures to increase the affordability of ACA exchange plans, is scheduled for a vote before July 4.

It is unclear whether the bill will specifically address social determinants of health and other racial inequities impacted by COVID-19.

Separately, the IRS issued a proposed rule that would enable employers that use HRAs to reimburse employees for the cost of their memberships in direct primary care plans.

However, there are still restrictions on eligibility for HSA contributions. The proposed rule also clarifies that a person with a high-deductible health plan who also has a direct primary care plan would not be allowed to contribute to an HSA.

Outlook:  If the House passes an ACA “stabilization” bill, it is unclear whether the Senate will take it up, even as part of a larger COVID-19 bill.  The American Health Policy Institute will be submitting comments supporting the proposed HRA change, but will be raising concerns about the limitation on using HSA contributions for direct primary care plans.