President Obama signed a bill, HR 1473 repealing a provision that would have required employers to offer certain low-wage employees company-paid vouchers to use when buying coverage in state health insurance exchanges. This legislation repeals the 2014 provision that would have required employers to offer low-wage employees company-paid vouchers to buy coverage in state health insurance exchanges.
Under the provision, employers would have been required to offer vouchers to employees with household incomes up to 400 percent of the federal poverty level and whose premium contributions were between 8 percent and 9.8 percent of their household income. The value of the voucher would have been equal to what their employer would have paid if the employees enrolled in a plan with the largest employer premium contribution. Employees then could have used the voucher to buy coverage in an exchange and keep the difference in cash, if the plan purchased was less. This bill will help keep the private insurance market viable by maintaining a level playing field.
OUR THOUGHTS ON: The Repeal of National Health Care Reform Free Choice Voucher
Obama acts to repeal the provision of the health reform that requires employers to provide "Free Choice Vouchers" to certain employees. The whole program would have been an administrative nightmare--at the least for employers to calculate who should receive the vouchers, because employers don’t collect family income information currently.
Also, if the employer plan had to compete with a government-subsidized plan, it would erode the enrollment in the group plan, and cause an uneven playing field between the private insurance carriers and the government subsidized plans, driving up cost in the private plans. Especially if you consider the employees might take the vouchers and purchase the lowest cost plan in the exchange, so that they could pocket the difference in cash.
Other provisions could still be scheduled for implementation, be regulated or repealed. This will be on ongoing process until all provision clarifications are decided upon, but for now employers do not have to worry about to whom and how to distribute these "vouchers".