What The Biden Administration Could Mean For Health, Benefits

Although the possibility of a public health care option is off the table for now, the individual health insurance market could see some changes under a Biden administration, according to the president of the American Benefits Council.

Jim Klein was one of several presenters who gave their outlook on the 2020 election’s impact on employer-sponsored benefits. His remarks were part of a webinar presented by the Employee Benefits Research Institute.

The Biden administration wants to build on the Affordable Care Act, Klein said, which is the subject of a case before the Supreme Court. The court is expected to rule in 2021 in the case of California v. Texas, which seeks to have the ACA declared unconstitutional after Congress removed the individual mandate penalty from the law.

At least three potential outcomes could come from the Supreme Court’s decision, Klein said. If the law is upheld, the administration is expected to build on the ACA and expand on it. If the ACA is struck down, expect Democrats to push for an expanded government role in health care. If the appellate court ruling is upheld, there will be an impact on employer mandates and reporting.

The Biden administration wants to make some changes to the ACA, Klein said, including dismantling the firewall for those no longer eligible for a subsidy. Biden also wants to make it easier for consumers to obtain affordable coverage by tying subsidies to the gold plan instead of the silver plan.

As for the retirement policy agenda, Klein predicted the following issues would be up for consideration in the new administration and new Congress:

• Mandatory auto enrollment and auto escalation.
• Reduce the threshold for part-time employees to participate in a workplace plan.
• Expand the Savers Credit.
• Larger catch-up contributions for workers age 60 and older.
• Matching contributions for student loan repayments.
• Increase the age for taking required minimum distribution to 75.
• Single employer funding reform.
• Multiemployer plan reform.

The exclusion of employer contributions for medical insurance premiums and medical care is projected to cost the federal government $3.1 trillion between 2020 and 2029, Klein said. The exclusion of employer-sponsored pension plan contributions and earnings is projected to cost the federal government $2.1 trillion during that same time period.

“What are we as a nation getting for this large investment?” he said. “For every $1 of revenue loss, you are spending $4.45 for health care and benefits for employees. And plans are paying out $7.15 for each $1 of revenue loss. It’s a huge bargain for federal government. Policy makers need to consider this as they decide whether to take a more government-focused approach or a more individual-focused approach to health care.”

Susan Rupe is managing editor for InsuranceNewsNet. She formerly served as communications director for an insurance agents' association and was an award-winning newspaper reporter and editor. Contact her at [email protected]. Follow her on Twitter @INNsusan.

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Susan Rupe is editor in chief, magazine, for InsuranceNewsNet. She formerly served as communications director for an insurance agents' association and was an award-winning newspaper reporter and editor. Contact her at [email protected].