Political forecasting models seem to be signaling that Election Day, now just three weeks away, could bring a change in power in the U.S. Congress. While Republicans are likely to remain the majority party in the House of Representatives, some question whether Democrats can hold their majority in the U.S. Senate.

In this sense voters indirectly may decide what’s next for the Affordable Care Act. From the perspective of the ACA and employer compliance, one of two scenarios will unfold... 

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The Elections and ACA Compliance: What to Expect—Part 1

Mon Oct 13, 2014

Political forecasting models seem to be signaling that Election Day, now just three weeks away, could bring a change in power in the U.S. Congress. While Republicans are likely to remain the majority party in the House of Representatives, some question whether Democrats can hold their majority in the U.S. Senate.

In this sense voters indirectly may decide what’s next for the Affordable Care Act. From the perspective of the ACA and employer compliance, one of two scenarios will unfold:

1. Democrats Hold Senate Majority.

Of a total 100 Senate seats, Democrats now have 53, Republicans 45 and Independents 2 (they align with Democrats), giving President Obama’s party a 55-45 lead. While the numbers may re-mix, if Democrats plus Independents retain an edge one can expect only minor “tweaking” of the Affordable Care Act.

For example, the ACA’s 2.3% excise tax on total sales of medical devices, opposed by a bipartisan coalition as anti-innovation, could be repealed or modified.

But more sweeping changes, including provisions that affect employers, would be off the table. Put simply, if the status quo prevails on Election Day employers should expect no change in ACA compliance regulations over the next two years.

2. Republicans Win a Net Six Seats and a Senate Majority.

If Republicans flip enough Democrat-held seats to claim a Senate majority next month, change could come to the Affordable Care Act, and to employer compliance, in 2015.

Before one considers what might be prime targets for ACA amendment two mitigating factors need to be kept in mind:

First, President Obama will veto any legislation that would cripple his signature legislative achievement and domestic policy legacy. To override the president’s veto of ACA legislation a two-thirds majority would be required in both House and Senate.  In other words, President Obama would have to go along with any changes Congressional Republicans propose in order for them to become law.

Second, public opinion surveys suggest that, while the law remains unpopular, majorities prefer that the ACA be “fixed” as opposed to repealed completely. Most Americans say they want to “mend, not end” the Affordable Care Act. Indeed, there are provisions in the 2010 law that voters strongly support, e.g., the prohibition on pre-existing condition exclusions and the age-26 eligibility for a parent’s employer health plan.

All this suggests that if Republicans win a Senate majority on Election Day they may be able to surgically modify the ACA but not demolish it.

In Part 2 of this blog we’ll look at some possibilities for 2015 “surgery” in ACA employer compliance, specifically Employer Shared Responsibility—the Play or Pay mandate.