Aon Hewitt Washington Report
July 17, 2017
Senate to Stay in Session to Work on Health Care Bill
The Senate is planning to stay in session through the first two weeks of August, instead of leaving for the August recess at the end of July, to give it more time to work on the health bill and other legislative matters. At this time, the House is planning to leave Washington at the end of July for its August recess, as previously scheduled, but House leaders have said House members would likely return if the Senate passes a health care bill.
IRS Issues Revenue Procedure on Benefit Suspensions for Multiemployer Plans in Critical and Declining Status
On July 12, 2017, the Internal Revenue Service (IRS) issued Revenue Procedure 2017-43, which revises procedures for applying for Treasury Department approval of a suspension of benefits under a multiemployer defined benefit pension plan that is in critical and declining status under Section 432(e)(9). Effective for applications submitted on or after September 1, 2017, the Revenue Procedure modifies and supersedes Revenue Procedure 2016-27 and is intended to facilitate the Treasury Department’s review in light of its experience in processing benefit suspension applications.
IRS Revenue Procedure 2017-43 is available here.
Aon Hewitt Publications
Senate GOP Releases Revised “Better Care Reconciliation Act”
Senate Republicans released a revised draft of the “Better Care Reconciliation Act” (BCRA) that is designed to “repeal and replace” the Patient Protection and Affordable Care Act. The revised draft makes several changes to the version released last month that are intended to improve the bill’s chances for passage in the U.S. Senate.
With respect to employer group plans, the BCRA would:
- Eliminate the employer mandate penalty retroactively to 2016 (but does not address employer reporting). This remains unchanged from last month’s original draft;
- In a new provision from the June draft, permit the use of health savings accounts to pay health insurance premiums, with certain limitations;
- Repeal most tax provisions but, unlike the June draft, retain the following tax law provisions:
- The .9% Medicare tax on high income earners;
- The 3.8% net investment income tax on high-income earners; and
- The health insurance providers for the deduction of compensation that exceeds $500,000;
- Remove the cap on contributions to health care flexible spending accounts (unchanged from June draft); and
- Delay the implementation of the Cadillac tax to 2026 (unchanged from June draft).
The Aon Hewitt bulletin, which summarizes the BCRA, including the July 13, 2017, revisions, is available here.