Repeal of Affordable Care Act Derailed by Senator McCain

Background

After several months on a legislative roller coaster ride, the effort by congressional Republicans to repeal and replace the Affordable Care Act (ACA), President Obama’s signature piece of healthcare legislation, has abruptly come to a halt. Early on Friday, July 28, 2017 – following a dramatic return to the Senate after receiving a diagnosis of brain cancer – Senator John McCain joined fellow Republican Senators Susan Collins and Lisa Murkowski in voting against the repeal of the ACA. Although, under the Budget Reconciliation process through which the bill was brought, the Republicans needed only a simple majority to pass the repeal, the third Republican “no” vote effectively defeated the bill and the plan to repeal ACA was derailed.

This latest “skinny repeal” version of the bill follows the defeat of various other ACA replacement bills and versions, from plans to repeal and immediately replace the ACA to proposed legislation that would repeal first and defer coming up with a replacement plan until later. To date, each proposed repeal bill has failed to pass the Senate, and this version was thought by many to be congressional Republicans’ last hope for healthcare reform for the foreseeable future.

Now What?

What happens next is uncertain. Senator McCain’s primary reason cited for voting against the bill was a strong desire to avoid a single party hastily pushing legislation through without meaningful bipartisan discussion and debate. Now the bill has been defeated, a number of Congress members appear open to discussing a bipartisan agreement to reform our nation’s healthcare system. Meanwhile, President Trump and some congressional Republicans continue to urge Congress to keep working on a full repeal of the ACA.

Outside of the chambers of Congress, government agencies could still take action to follow President Trump’s executive order from January of this year, but employers still must comply with the ACA to avoid penalties. The executive order directed the Secretary of Health and Human Services (HHS) and the heads of all other executive departments and agencies such as the Internal Revenue Service (IRS) to minimize the economic burden of the ACA. HHS administers ACA healthcare subsidies (or advance premium tax credits), and the IRS oversees the enforcement of the ACA’s Individual and Employer Mandates and the associated tax reporting responsibilities. These agencies can change the structure of the subsidy program or the specific requirements for reporting offers of coverage – perhaps presenting further obstacles by forcing employers to comply with an evolving system – but the agencies cannot repeal the ACA.

As President Trump and the Republican Party’s campaign to repeal and replace the ACA suddenly halts, the ACA remains the law of the land for the foreseeable future. To avoid penalties for failure to offer or report on healthcare coverage, we strongly encourage all employers to continue complying with existing regulations.

If your organization needs support with compliance now that the plan to repeal ACA was derailed, Equifax can help. Please contact our specialized ACA Compliance team here.