Thompson’s small business health care bill passes House

June 22--A bill by Rep. Mike Thompson (D- St. Helena) that would allow small businesses to continue offering their employees Health Reimbursement Arrangements, heads to the Senate after passing the House of Representatives Tuesday, Thompson's office announced.

The Small Business Healthcare Relief Act (H.R. 5477), passed out of the House Committee on Ways and Means last week. This legislation allows small employers to continue to offer HRAs to their employees so "they can choose a quality, affordable health insurance plan that fits their individual budget and healthcare needs," Thompson's office said. Existing Treasury Department guidance under the Affordable Care Act limits the use of HRA's for small businesses.

"The passage of the Small Business Healthcare Relief Act is a prime example of what we should be doing in Congress -- working across party lines to make health coverage available to our constituents," Thompson said. "This legislation will help small business owners, workers and their families. By ensuring that small business owners can continue to offer HRAs to their employees, we not only arm our small business owners with a competitive advantage to recruit and retain employees, but we also help ensure that hard-working Americans can receive quality, affordable coverage."

Describing this bill as a "common-sense, bipartisan solution ensuring our small businesses aren't penalized for trying to do the right thing," and adding that "HRAs are an affordable solution for both employees and employers to combat the escalating cost of health insurance," Rep. Charles Boustany (R-LA) thanked Thompson "for continuing to work with me to find ways to increase access to high-quality healthcare for all Americans."

On September 13, 2013, The Department of Treasury issued guidance disallowing businesses from using HRA's as a tax-free means to reimburse employees, stating these arrangements were disqualified under Affordable Care Act's annual dollar cap, Thompson's office said. The Small Business Healthcare Relief Act "restores flexibility and choice into the marketplace by ensuring that small businesses are allowed to use pre-tax dollars to give employees a defined contribution, allowing employees to use these funds as an HRA to purchase health coverage on the individual market, as well as for qualified out-of-pocket medical expenses," he said.

It protects small business employers from being penalized for providing this option to employees, he said.

Thompson said the legislation is also "budget-neutral, meaning it won't add a single dollar to our deficit," and it's supported by the United States Chamber of Commerce, the National Federation of Independent Business, the National Association of Manufacturers, the Retail Industry Leaders Association, the National Association of Homebuilders, the National Association for the Self-Employed, and the Coalition for Affordable Healthcare.

Thompson represents California's 5th Congressional District, which includes all or part of Solano, Napa, Contra Costa, Lake and Sonoma counties.

Contact Rachel Raskin-Zrihen at (707) 553-6824.

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