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February 10th, 2017
This update is part of a Brown & Brown series summarizing new guidance issued in connection with the Patient Protection and Affordable Care Act (also known as the ACA or Health Care Reform).
We are joining forces with our business partner, the law firm of Miller Johnson, to provide these updates to you.
For this edition, we change course and start exploring possible changes to, including an outright repeal and replacement of, the ACA. We begin by reviewing President Trump’s Executive Order entitled “Minimizing the Economic Burden of the Patient Protection and Affordable Care Act Pending Repeal” (Executive Order 13765 of January 20, 2017, which is available at: https://www.gpo.gov/fdsys/pkg/FR-2017-01-24/pdf/2017-01799.pdf#page=1).
President Trump’s Executive Order (“E.O.”) is divided into six different sections.
Here is a brief summary of those sections:
Section 1 confirms President Trump’s intent to “seek a prompt repeal of the [ACA].” While the repeal is pending, the E.O. states that “it is imperative for the executive branch to … take all actions consistent with law to minimize the unwarranted economic and regulatory burdens of the [ACA] and prepare to afford the States more flexibility and control to create a more free and open health care market.”
Section 2 is the section of the E.O. that is most applicable to employers. This section authorizes the Secretaries of Health and Human Services (“HHS”) and—while not expressly named—the Treasury (including the IRS), and Labor to “waive, defer, grant exemptions from or delay the implementation of any provision or requirement of the [ACA] that would impose … a cost, fee, tax, penalty, or regulatory burden on” the following:
Section 3 instructs the Secretary of HHS and the heads of all applicable Executive departments and agencies to provide flexibility to and cooperate with states in implementing healthcare programs.
Section 4 instructs the Executive departments and agencies to “encourage the development of a free and open market … for offering of healthcare services and health insurance, with the goal of achieving and preserving maximum options for patients and consumers.”
Section 5 authorizes the issuance of regulations through normal procedures to carry out the directives of the E.O. (In a subsequent Executive Order, President Trump required the repeal of two regulations for every new regulation issued. This means that each regulation issued under this E.O. requires the repeal of two existing regulations.)
Section 6 states that the E.O. is not intended to impair the authority of any of the Executive departments or agencies or grant any new rights or benefits to any party.
Here are our observations about what guidance this E.O. gives and does not give to employers regarding the ACA:
Guidance that this E.O. gives:
We are actively monitoring all developments related to the ACA and will provide periodic updates. Rest assured, we will continue to update you as more details emerge. When we know, you will know.