Some Health Care Legislation Could Pass Congress Despite Leadership Turmoil

The leadership turmoil in the U.S. House of Representatives has clouded the outlook for passing health care legislation this year. However, there’s also a lot of momentum in Congress behind the health policy work that already has been done, so some health care reforms “have a chance of hitching a ride on a big catch-all bill at the end of the year. And legislation that doesn’t cross the finish line this year will carry over to next year.”

That was the word from Geoff Manville, partner at Mercer, during a recent webinar that provided an update on health care law and policy.

Drug pricing reform legislation has bipartisan support in Congress and backing from employers, Manville said. But the timing and shape of final legislation this year may depend on the need for revenue in an end-of-year package.

Two drug pricing reform bills – HR 5378 and S. 1339 – target pharmacy benefit managers in the commercial market. The bills seek lower costs through greater transparency, provider competition and billing reforms. Highlights of those two bills include:

  • Requiring extensive new disclosures by PBMs to plan sponsors.
  • Requiring PBMs to pass through to health plans all rebates, fees discounts and other remuneration.
  • Banning “spread pricing” in the commercial market.
  • Requiring PBMs and third-party administrators to disclose direct and indirect compensation to plan fiduciaries.
  • Codifying, strengthening and expanding price transparency rules.

The Biden administration’s proposals on mental health policies and telehealth also could see a new legislative push, Manville said.

The administration proposed a rule that aims to reinforce and bolster the Mental Health Parity and Addiction Equity Act and seeks comment on how standalone telehealth might enhance access to mental health and substance use disorder care.

Health Savings Account rules up for action

The House Ways and Means Committee passed two bills updating health savings account rules, and Manville said those bills could be part of a year-end mix of legislation.

The Bipartisan HSA Improvement Act (HR 5688) would allow individuals to convert their own health care flexible spending or health reimbursement arrangement dollars into an HSA, subject to certain limitations and requirements.

The HSA Modernization Act (HR 5687) increases annual HSA contribution limits, allows HSA-eligible spouses aged 55 and older to make catch-up contributions to the same HSA, and allows HSA funds to be used for qualified long-term care services needed for chronically ill individuals.

The House also passed the CHOICE Arrangement Act (HR 3799), which contains four Republican proposals targeting small employers. The bill, which Manville said faces an uncertain future in the Senate, allows employers to subsidize individual health insurance coverage through Individuals Coverage Health Reimbursement Arrangements, expands access to Association Health Plans for businesses and self-employed workers, prevents stop-loss insurance from being regulated as health insurance, and requires the treasury department to notify employers about tax-advantaged flexible health insurance benefits.

SECURE 2.0, DC plans also in the spotlight

Also topping the Capitol Hill agenda, Manville said, are a follow-up to SECURE 2.0 and legislation surrounding defined contribution plan investments. Retirement policy is largely shifting to the regulatory arena, he said.

Work on a SECURE 2.0 technical corrections bill continues but its timing is uncertain, he said. Lawmakers are outlining some intended fixes to the bill as plan sponsors submit their own lists of corrections they want to see.

A bipartisan House bill would permit 403(b) plans to invest in collective trusts. The bill, HR 3063, was approved by the House Financial Services Committee and its supporters are aiming for a vote by the full House.

Recent legislation begins to set the table for the next potential reform package, Manville said. The Auto-Reenroll Act (HR 4924 and S 2517) seeks to encourage adoption of automatic re-enrollment in retirement savings plans. The Lifetime Income for Employees Act (HR 3924) would ease rules on annuities as a default option in retirement savings plans. The Women’s Retirement Protection Act (HR 2060 and S 2627) seeks spousal consent for DC plan distributions.


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