House passes health benefits package with a 216 to 211 vote

The employee benefits provisions would:

◆ Keep states from regulating employers' stop-loss insurance as health insurance.

◆ Make it easier for small employers to work together through association health plans to buy health benefits.

◆ Create a new legal framework for individual coverage health reimbursement plans, or ICHRA "cash-for-coverage" plans.

◆ Require pharmacy benefit managers that work with employer plans to send the employers detailed tracking reports.

What it means: The odds of the package passing in the Senate as is might be low.

Only one of the 217 Republicans who participated voted against the package, but none of the 210 Democrats in the roll call voted for the package.

The House Rules Committee prepared the health benefits bill for floor action at a meeting Tuesday.

Rep. Jim McGovern, D-Mass., the highest-ranking Democrat on the committee, suggested that the Republicans who created the package were wasting other House members' time.

"They're bringing up a bill that does nothing to solve the problem of premiums skyrocketing in just a few weeks and a bill that is dead on arrival in the Senate, by the way," McGovern said.

ICHRAs: House members briefly discussed ICHRA plans during floor debate.

The package ICHRA provisions would rename the accounts "custom health option and individual care expense" arrangements, or CHOICE arrangements.

Rep. Mariannette Miller-Meeks, R-Iowa, the package sponsor, said that the stop-loss provision would help employers cut their costs by 30% and the CHOICE arrangement provision would give families more control over their health care dollars.

Using CHOICE arrangements, "workers can choose the right plan rather than being stuck in plans that cost too much and deliver too little care," Miller-Meeks said.

Democrats did not criticize the CHOICE arrangement concept, but Rep. Mark Takano, D-Calif., criticized Republicans' use of the word "choice" in connection with their package.

"Republicans say it will give consumers more choices," Takano said. "This isn't about choice. People will have the choice to be refused health insurance for preexisting conditions by unregulated junk health insurance plans."

Association health plans: House members spent somewhat more time talking about the AHP section in the package.

Christopher Condeluci, a longtime advocate for association health plans, has argued that the current association health plan proposals have been designed to help state insurance regulators minimize adverse selection and that AHPs are attractive to small employers partly because AHPs can help small employers offer the kind of high-quality benefits that might appeal to workers with serious health problems.

The AHP provision in the package that passed yesterday is based on a bill introduced by Rep. Tim Walberg, R-Mich., that has two Democratic sponsors — Rep. Sanford Bishop, D-Ga., and Rep. Henry Cuellar, D-Texas.

Rep. Burgess Owens, R-Utah, said employers are looking for ways to cut health benefits costs and expand coverage.

"When asked, 79% of employers reported they were interested in joining an association health plan," Owens said.

During President Donald Trump's first term in the White House, which led to a brief period of AHP-friendly federal rules, AHPs helped employers in some industries cut their coverage costs by 50%, Owens said.

But Rep. Bobby Scott, D-Va., said he still thinks AHPs would hurt the traditional fully insured group health market.

"AHPs would make it easier for associations to cherry-pick small employers with younger, mostly male workforces, who are healthier and can be charged lower rates," Scott said. "Small employers whose workers are older and sicker would remain in the traditional market. If you pull healthy groups out, all of those left behind will be paying more."

History has shown that multiemployer benefit plans tend to be vulnerable to fraud and insolvency, Scott added.

The legislation shut out of the package: A temporary boost in ACA exchange plan premium subsidies that was adopted in response to the COVID-19 pandemic is set to expire Dec. 31. The boost increased subsidy levels and made subsidies available to higher-income people.

The expiration might have little effect on the lowest-income users, but it could double out-of-pocket spending on coverage for moderate-income exchange plan users, according to a KFF analysis.

For some higher-income people who would lose access to subsidies, annual coverage costs could increase to more than $30,000, from less than $10,000 this year.

Republicans tried to persuade the House Rules Committee to add an amendment that would maintain ACA premium subsidies at high levels for at least one more year.

The committee declined to add the amendments to the package.

Four House Republicans responded by signing a discharge petition, which was introduced by House Democrats, that will push a three-year subsidy boost extension bill to the House floor.

The bill could reach the House floor in January, according to press reports.