At the table is james gelton, Senior Vice President for policy. An operation under the ee rrisa industry. Explain what the Erisa Industry Committee is all about . Eric for sure is an association that represents about 100 of the very largest businesses, each with at least 10,000 u. S. Employees. Those businesses offer comprehensive and Health Retirement benefits to their employees. We represent them on benefits issues. Lets get systems numbers. How Many Employers offer Health Insurance. There are 178 million americans who get Health Insurance through a job. And thats a significant number of folks. How much are their Companies Paying for the premium these days . Whats the average . Well, so, i think its important to note that on average the company pays about 80 of the cost of premium and as well as the Overall Health care costs. So the employees are paying usually 25 of the premiums. That monthly cost that an employee pays, thats only 1 4 of the cost. Take us to large employers and how theyre affected. Give us the recent history. So its true that there were some effects on large employers from the Affordable Care act. If you think of rule changes that took place in 2010, such as the requirement to have a dependent up to the ainge of 26 on your plan, but for the most part the Affordable Care act plan was those who were in government insurance. Lets put the phone numbers up on the bottom of the screens. James gelton of the Erisa Industry Committee. We have two lines here for this segment. If youre insured through your employer call 2027488000. For everyone else call 2027488001. Were looking forward to hearing from as many folks who are insured through their employer. You said the number is 170 178 Million People. So plenty of folks out there, but as we sit here, there are changes underway for the Affordable Care act. We know the house passed a bill. We think the senate is working on something. We havent seen any committee action. Speak to us about what changes youre watching out for based on what you know about the house bill so far and what youre hearing about the senate bill. So the house bill you had four different categories. You had changes to medicaid, changes to the individual market. You had changes to the sorry, to the tax structure that governs health care and changes to Consumer Directed Health plans, so things like a Health Savings account or flexible spending arrangement. For businesses and people who are employed through or people who get their Health Insurance through an employer, you really only care about those last two because the individual market and medicaid, thats not whats affecting you. So what you would be looking at if youre in an employer sponsored plan is your costs would probably go down because taxes would go down. At the same time if you have a consumer directed account like an hsa, you get a better coverage. You have higher limits. What are you hearing about the senate bill . We know about the house bill. Senate bill information has been scarce. What are you hearing . The latest ive heard is they are really close to a deal. You have moderates. Gop senators from red states whereby they have done a Medicaid Expansion. They have a tough deal because they dont want to lose the coverage expansion that theyve gained but in terms of changes to hsa, et cetera, thats kind of baked. Its done. In the house something called a macarthur amendment which sort of came out of the blue it seemed at the very end of their process dealt with this concept of essential benefits. Can you remind us what this concept of essential benefits means and what this amendment said in the house bill . If you purchase Health Insurance in the individual market through a Health Insurance exchange, every plan sold on that exchange is required to cover each of these Ten Essential Health benefits. They cant have lifetime or annual limits on those benefits either. If your in the employer sponsored market in a selfinsured plan, the essential Health Benefits, or ehbs, dont apply. You cant have lifetime or annual limits. A little bit from the wall street journal under the house bill large employers are allowed to lower their benefits under the waiver. They impose lifetime limits and eliminate the out of pocket cost gap under the gop legislation. Do you want to think of that . I think that was a sensationalist story but if you look at the latest Congressional Budget Office report what they said is that was not going to happen if the ahca were to become law. I want to ask you about the cadillac tax. Very much on the minds of people on the hill. What is the cadillac tax and whats at stake here . The cadillac tax is the term for short to describe the excise tax on high cost Health Insurance sponsored by employers. What this tax says is if your Health Insurance costs a certain amount of money per year, then its subject to a new 40 tax and the only way that an employer can avoid that 40 tax is eefither by increasing costso consumers or by reducing the benefit. I would say if you have employer sponsored Health Insurance today, even though the cadillac tax isnt going to take effect until 2020, youre already seeing the effects of the cadillac tax because youre having higher deductibles, higher premiums, higher coinsurance. Your coverage is covering less, network is getting narrower. And on that cadillac tax theres a little bit from the committee who are responsible. They write first cadillac tax will help control Health Care Costs by discouraging overly generous employer provided Health Insurance plans. Second it would help wage growth by reducing Employee Share compensation. What do you make of that . So this is an assertion thats so silly only economists could believe it. What theyre saying essentially is that if they launch a new tax on employees Health Insurance benefits, that everybodys going to so you can believe the economists or you can believe the people who are signing the paychecks. Either way the assertion that benefits are too good and that Health Insurance is overly genero generous, ive got to tell you, i never hear that from employees. I never hear that from people in real america. Its a very washington d. C. Thing to suggest. A lot more to go through here. Steve is calling from woodridge, virginia. Youre on with james gelton. Go ahead, please. Caller yes, sir. I have to disagree with the man thats on there. My wifes been on health care with her employer for her whole career, and she said the cost will go down. It never went down from day one until she got into the program. It always goes up. I dont care if its 3, 4, 5 but it goes up every year, and i dont care what you do with it, theyre not going to give it to you at the same price or not increase their profit. Thats all i have to say. Thank you. Thanks, steven. Generally health care does tend to always go up. Question is always about the rate of the increase. Is it going to go up by 5 , 10 , 15 . What happens is when you launch more taxes on employer sponsored Health Insurance it goes up more quickly than it otherwise would. We have jim calling from royal oak, michigan. Good morning, jim. Yes. Caller yes, i was a corporate employer for Blue Cross Blue Shield for michigan at that time i was called the erisa expert. Any changes will not affect just small employers but will affect we had employers with employees that were choosing the erisa exemption. I would like your we will ask our guest to respond to that. Go ahead, james gelton. Absolutely. If a plan is fully insured its required to cover all of the various coverage requirements that different states impose, whereas, if a plan is selfinsured and its governed by erisa, it only has to cover federal mandates. So what you see is in certain states there are literally hundreds of different requirements and those requirements are good for some patients but they end up raising costs pretty considerably. You will have Small Businesses that say maybe we ought to consider selfinsuring in order to get away from those mandates. The recent letter that you wrote to the senator, what were you telling the senator in this . Senator hatch and the finance committee reached out to trade associations and they asked for business and other people to weigh in on whats important in health reform. I think we laid out several key points that weve gone over previously. Lets reiterate them. Number one, the clakd tax has got to go. Its going to eventually destroy the Health Care System that 178 Million People rely on. Number two, we have got to improve Health Savings accounts. Health savings account is a wonderful concept, the problem is, there are a whole lot of people who dont have several thousand dollars to put into an hsa. For those people we need to tweak these plans so that they work better for them. Then third is its super important that you worry about lowering costs. If youre going to do health reform, the most important thing is that you lower Health Care Costs. In fact, it was then senator barack obama when he was running for president who originally said its not that people dont want Health Insurance, its that it costs too much. Are there realistic options to replace the clakd tax . We dont support options to replace the cadillac tax. The question is are there realistic options to replace the budget. Those taxes, most of them are probably going to end up being repealed under the ahca. The question is when will they be repealed. If theyre repealed now, they wont bring in any money but if theyre repealed in the next two or three years theyll bring in money over the next two or three years. Lets go back to calls. Conway, missouri. Is it delana . Delano. Caller thank you very much. I have a dermatologist. He is retiring. The last time i went to see him i was in there for about 30 minutes. My bill was 535. I got to looking at how much he got and he only got 57 out of that money. Where did this other 500 go . You know, generally im not sure how that would work. Oftentimes costs are vastly increased given whether a doctor participates in a network. If its not in your network then you could have been given a much larger bill than you would have had you gone to a specialist in your network. That being said, there are all kinds of practices that could raise the amounts of money you would have to pay. For instance, balance billing in which your Insurance Company would say were only going to pay 57 out of that 500. Then the provider would go ahead and send you a bill for that additional 433. There are some states that are going to take action on that. Nicholas calling from pikesville. Caller hi, good morning. I have a question regarding employers. When an employer offers Health Insurance to its employees, it normally subsidizes the cost of the insurance. That means for every employee that the employer would hire the employer has, so to speak, an exposure whereby the employer would be would would would have to bear the cost for that subsidy. In the events where the employee elects not to have Health Insurance through the employer, perhaps because the employees spouse covers the employee, then could not that exposure that the employer has be, so to speak, channelled towards call it a tax, but could it not be siphoned off to generally Fund Health Care . Because after all the employer is any way on the line for that cost . Lets hear from our guest. Certainly i think there are all different kinds of ways that you could raise revenue and a tax on employers is one that has been proposed before, but its not one that we would support. In the end every dollar that your employer ends up having to pay, whether its for taxes or anything else, is one less for capital investments, for expanding their offerings, for hiring more people. When youre draining funds away from employers to pay for the Health Care Costs of people who that employer does not employ and who are not their family or retirees, what you are really doing is hurting employers. One tweak to ask about the practicality of an hsa, how will an hsa pay just one stay in a hospital which might cost tens of thousands of dollars . One of the proposals in the American Health care act was to tax the annual contribution limits to an hsa to an annual out of pocket limit meaning you could fully fund your Health Care Costs through the hsa. Now you have to find the money to put into that hsa. For an individual, that could be five, 6,000. You could get an instant 30 savings. Hospital stays are incredibly expensive. Well have about 10, 11 minutes with our guest. Take calls for james gelfant who is Senior Vice President for erisa. Been the director of federal affairs at march of dimes. Counselor to senator tom coburn on the u. S. Senate Homeland Security committee and is working as a lobbyist at the chamber of commerce. We have senson from l. A. Good morning. Reporter good morning. How are you doing this morning . Doing fine. Caller you know, my point is the president of the United States do all of this, youve got sick people out there and taking the People Insurance away from them. You know, he can afford it, but we cant, you know . So i think that you might be referencing the Congressional Budget Offices estimate that if the American Health care act as passed by the house became law, ten years from now there could potentially be 23 million fewer people that would have insurance than under current law. I think its important to look closely at those numbers and break down that 23 million. Of that 23 million, about 11 million of them are people who under current law are forced to buy Health Insurance, whether or not they want it. The Congressional Budget Office says those people wont buy it unless theyre forced to. The question is there are 5 Million People who have not done a Medicaid Expansion. Cvo says they will do a medicide expansion. They didnt say which states they would be. I think we should focus on 4 Million People who cbo said are currently covered by medicaid. They are going to legitimately need help. The question is would the subsidies available to them under this gop bill, would they be sufficient . I think right now theres a robust debate going on in the United States senate over whether or not its enough money and its doubtful to me that a piece of legislation could get through the Senate Unless and until they put enough money into the actual credit. Medicaid in its piece on the hill, the senate gop is seeing a path towards obamacare repeal. There are major obstacles ahead. Critically Senate Moderates say they can add that albeit on a slower timetable. A compromise would remove one of the biggest obstacles for the bill. The moderates want to phase out of the medicaid and take seven years while the Majority Leader Mitch Mcconnell said two. A little bit of a difference there. What do you think . I think its interesting were talking about ending a Medicaid Expansion. You might remember that in order to get the Affordable Care act through the senate, a special deal had to be cut with then senator ben nelson from the state of nebraska, and that deal was he didnt want to pay for the Medicaid Expansion in nebraska. He wanted it to essentially be free for them. Their deal was then called the cornhusker kickback was that the federal government would take 90 of the costs, not for all medicaid people, so not for disabled people, pregnant people, the poorest of the poor, but only for people who were in that Medicaid Expansion population, which was mostly between 100 and 138 of the federal poverty level. So if you were super poor, so below 100 or you were disabled, pregnant woman, the federal government would give less money than they would give if you were in that expansion population. What the gop is trying to do is to save that aspect of it out such that if a state wants to cover people who are hired and would currently be in the expansion population, theyve got to pay the same as what they pay for their normal population. Where do you see democrats overall in the senat