Trump victory's impact on benefits, health insurance: What's next for employers?

U.S. President-elect Donald Trump smiles as he arrives to speak at an election night rally in New York. Trump's election has small business advocates expecting changes in government policy on issues like health care and the environment. (AP Photo/ Evan Vucci)
U.S. President-elect Donald Trump smiles as he arrives to speak at an election night rally in New York. Trump’s election has small business advocates expecting changes in government policy on issues like health care and the environment. (AP Photo/ Evan Vucci)

It actually happened: Donald Trump has been elected president.

What does that mean for employers?

The short answer: It’s hard to say.

Trump, like all of the other GOP candidates he vanquished in the primary earlier this year, has repeatedly promised to repeal the Affordable Care Act “on day one” of his presidency. However, what Congress will replace it with it is hard to tell at this juncture.

Trump’s own pronouncements on health care throughout his campaign have varied.

No. 1: Trump & killing the ACA

At the beginning of the primary he said, without providing specifics, that he would provide universal coverage.

Later on during his campaign, however, Trump released a health care plan that largely mirrored conventional Republican proposals put forward by other leading Republicans, such as Speaker Paul Ryan. Those include turning Medicaid into a block-grant program to states and allowing insurers to sell health plans across state lines.

However, what remains unclear is how Trump will scrap the ACA and deal with those who have gained coverage through the law.

“If they repeal, that’s 22 million people, about 10 percent of the American public, that loses coverage. So they better have a plan,” says Kim Buckey, VP of client services of DirectPath, a benefits management consulting firm, in an interview with BenefitsPRO.

So far, says Buckey, Trump and GOP leaders in Congress have not offered specifics about how they plan to repeal the ACA without leading to loss of coverage for current beneficiaries.

“I really haven’t seen anything that clearly addresses that,” she says.

Supporters of the Affordable Care Act hold up signs

Supporters of the Affordable Care Act hold up signs as the opinion for health care is reported outside of the Supreme Court in Washington, Thursday June 25, 2015. (AP Photo/Jacquelyn Martin)

No. 2: Trump & employer insurance mandate

While Trump has promised to continue the ACA’s provision that bars insurers from discriminating against customers based on pre-existing medical conditions, it will be a challenge for him to keep this promise without the individual mandate, which he and other Republicans have pledged to repeal.

The employer insurance mandate is also likely to go out the window, along with a number of other taxes and regulations associated with the law. The medical device tax, as well as a tax on health insurers, both of which were suspended for 2017, will likely not be coming back anytime soon. Nor will the Cadillac Tax, which was suspended until 2018 in a budget agreement last year.

Whatever comes of the GOP’s health care efforts, says Buckey, “it’s a great opportunity for employers and industry to weigh in” on what they would like to see happen.

The National Business Group on Health is voicing optimism about the incoming administration.

“We look forward to working with him and the new Congress on eliminating the ACA excise tax and strengthening employer-sponsored health coverage for the millions of Americans who rely on it,” says Brian Marcotte, president of the group, in a statement. “We also look forward to working to continue to advance the transformation of health care payment and delivery in Medicare and other government programs so that all Americans can benefit from more effective and efficient health care.”

Buckey believes that there will be a fair amount of jitters in the insurance industry as companies that have invested in the marketplace wait to understand the implications.

If Congress begins the repeal process right away, there likely won’t be a new law in effect until August, Buckey guessed.

Until then, the ACA is still the law of the land.

 supporters of fair immigration reform

In this April 18, 2016 file photo, supporters of fair immigration reform gather in front of the Supreme Court in Washington. Republican presidential candidate Donald Trump’s aggressive rhetoric on illegal immigration has obscured what may ultimately be a policy detour, the Republican presidential nominee is the first major party candidate in modern memory to propose limiting legal immigration. (AP Photo/Pablo Martinez Monsivais, File)

No. 3: Trump & the Children’s Health Insurance Program

What is all very much in the air is the future of the Children’s Health Insurance Program, one of Hillary Clinton’s major initiatives during her time as First Lady during the 1990s. It must be reapproved in 2017, and the new president and Congress might be pulled in different directions on the issue from various constituencies.

Trump, a former Democrat who eschewed many of the traditional small government stances favored by conventional Republicans throughout the campaign, might come into conflict with ardent fiscal conservatives in the Congressional GOP leadership, such as Speaker Paul Ryan.

No. 4: Trump & regulations, taxes

Other relevant issues for employers include regulatory and tax policy. Similar to health care, Trump has so far painted in broad strokes, but his message has clearly been one of lower taxes and less regulation.

Among his specific proposals is a temporary “pause” on new business regulations and a directive to federal agencies to rank existing regulations on business from most important to least important.

Trump has also pledged to slash corporate taxes and overall income taxes, a centerpiece of his economic agenda that he promises will fuel record economic growth that will make up for the increases in military spending and reductions in revenue from the tax cuts.

In addition, Trump has called for incentives to get employers to offer paid maternity leave to employees as well as allowing workers to deduct the cost of childcare from taxes.

No. 5: Trump & immigration, trade

Finally, despite immigration and trade being front-and-center of Trump’s campaign for president it’s far from clear what exactly he will do on those issues.

Although he railed against the status quo on both issues throughout the campaign, he also said he would be open to “softening” his approach on undocumented immigrants and while he promised to negotiate “better” trade deals with other nations, he was far from specific in describing how they would be different than the ones currently in place.

On both immigration and trade, Trump will be facing opposition from the business community and many members of his party. Ryan is sympathetic to both free trade and immigration reform.

The U.S. Chamber of Commerce put out a statement on Wednesday in response to the election urging the incoming president to embrace free trade, outlining its benefits to the American economy.

Leave a Reply