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The House Ways and Means Committee came out Monday with "The One, Big, Beautiful Bill" — a 389-page package that includes many employee benefits proposals mixed in with general income tax provisions, public health program provisions and other provisions.
Key proposals would:
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◆ Make the individual coverage health reimbursement arrangement plans more generous and easier for employers to offer.
◆ Update the paid family and medical leave tax credit rules.
◆ Make the health savings account and and flexible spending arrangement rules more generous and more flexible.
At press time, the committee was preparing to "mark up," or amend and vote on, the package at 2:30 p.m. today. The committee was preparing to post video of the meeting here.
The chances that the package will get through the House intact appeared to be uncertain.
Maya MacGuineas, president of the Committee for a Responsible Federal Budget, a group that promotes efforts to narrow the federal budget deficit, put out a statement blasting the package.
The draft "includes a hodgepodge of expensive new tax breaks designed to appeal to special interests and constituencies," MacGuineas said. "Most would worsen tax complexity, distort work and investment choices, and undermine tax efficiency and neutrality."
Related: Employers and benefits brokers unite to defend group health tax exclusion
But, even if the Ways & Means package fails to pass as is, some provisions could continue to move forward with whatever does pass, and other provisions could eventually get through Congress in other packages or as stand-alone bills.
Budget reconciliation process: The new package is not a normal bill.
Ordinary bills are considered using "regular order" rules. The bills must get a majority vote to pass in the House. The bills then must getat least 61 votes to reach the floor of the Senate without facing the threat of a filibuster, or endless round of debate.
The budget reconciliation process lets one or two budget-related measures per year get through the Senate with just 51 votes.
In recent decades, lawmakers have taken advantage of the budget reconciliation process by using it to pass giant packages of popular measures.
Whether Congress can use the budget reconciliation process to pass a giant measure this year is uncertain.
In December, the administration of President Donald Trump forced Congress to replace a 1,547-page spending package with a 116-page version. Rep. Tom Cole, R-Okla., who is now chairman of the House Appropriations Committee, said on the House floor that he believed that Congress should use the budget reconciliation process to pass relatively short bills that focus on funding the government and cutting spending and stick to regular order rules for other measures.
Package details: Drafters of the package have given each major section a section number. The easiest way for employers and benefits advisors to understand what's in there is to read the official "section-by-section" document, or detailed summary.
Individual coverage health reimbursement arrangements: Sections 110201,110202 and 110203 relate to ICHRAs, or vehicles employers can use to provide cash workers can use to buy their own individual health coverage.
The sections would put the current ICHRA regulations in federal law and let ICHRA sponsors and users save money by giving the workers the ability to use pretax earnings contributed to cafeteria plans to pay for the workers' share of health coverage purchased through an Affordable Care Act public exchange program. In effect, that would help the workers save money on their share of the premium payments.
Paid family and medical leave: Section 110106 would make the current tax credit, which is equal to 12.5% to 25% of the wages paid to the employees out on leave, permanent; let employers use the credit to pay part of the premiums for paid family leave insurance; and reduce the minimum work requirement for workers eligible for paid leave to six months, from 1 year today.
Health accounts: Sections 110209 through 110213 would make a variety of changes in HSA and FSA rules, such as letting two spouses contribute to the same HSA, letting workers move cash from terminated FSAs and HRAs into HSAs, and letting workers use HSA money to pay medical bills incurred within 60 days before the workers set up the HSAs. Section 110207 would let workers who have access to an on-site clinic contribute to HSAs. Section 110208 would let workers use HSA money to pay for physical fitness facility memberships, with a cap of $500 per year for an individual and $1,000 per year for a family.
Student loans: Section 110113 would make the current $5,250 tax exclusion for employers' efforts to repay workers' student loans permanent. The section would also provide for the exclusion to grow with inflation.
Child care: Section 110105 would let employers join with other employers and hire an outside entity to provide child care that would qualify for the federal employer child care credit. The percentage of qualified care expenses covered would increase to 50%, from 25% today.
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