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Healthcare Group Warns of Effects of Minimum Essential Coverage Regs

JUN. 9, 2022

Healthcare Group Warns of Effects of Minimum Essential Coverage Regs

DATED JUN. 9, 2022
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June 9, 2022

The Honorable Charles P. Rettig
Commissioner
Internal Revenue Service
Department of the Treasury
1111 Constitution Avenue NW
Washington, DC 20224

RE: Affordability of Employer Coverage for Family Members of Employees (REG-114339-21)

Dear Commissioner Rettig:

The New Jersey Hospital Association appreciates the opportunity to offer comments in response to the above-referenced rule proposal on behalf of its more than 400 members, including all of New Jersey's acute care and specialty hospitals as well as hundreds of post-acute providers.

NJHA views access to affordable health care coverage as fundamental in ensuring consumers are receiving quality care; moreover, it is vital to addressing many of the challenges within the healthcare system including lowering costs and addressing equity and social determinants of health. Therefore, NJHA strongly supports the IRS's proposed changes to the affordability rule.

Within the notice of proposed rulemaking, the IRS and the Treasury Department are proposing revisions to IRS Code 36B, previously finalized in 2013, that would impact the availability of premium tax credits for family members of individuals offered employer health coverage.

Under the ACA, an individual worker and family members who can enroll in "affordable" job-based health insurance are eligible for premium tax credits and other financial help to lower the costs of Marketplace coverage.

However, existing regulations established that the definition of "affordable" — for both an individual employee and a family — is based only on the cost of individual-only coverage and does not take into consideration the often significantly higher cost of a family plan.

As a result, it is estimated that approximately 5 million people, mostly women and children, have been locked out of receiving financial assistance to purchase health coverage through the health insurance Marketplace. This situation has become known as the “family glitch.”

Within the Explanation of Provisions included in the proposal, the IRS and Treasury Department state that the agencies “believe that section 36B(c)(2)(C)(i) of the Code is best interpreted in a manner that requires consideration of the premium cost to the employee to cover not just the employee, but also other members of the employee's family who may enroll in the employer coverage. This interpretation would create consistency across parallel provisions of the Code enacted by the ACA, specifically regarding the affordability tests in sections 36B and 5000A.”

NJHA strongly supports this interpretation and urges the IRS and Treasury Department to finalize the proposal.

Further, we support the inclusion of a proposed provision clarifying that the definition of minimum essential value must include inpatient hospital services and physician services. We believe this provides for consistency with the Department of Health and Human Services' requirements and formalizes the IRS' previous guidance.

Thank you for your consideration of our comments. We look forward to additional opportunities to work with all federal agencies to ensure access to affordable, quality healthcare for consumers.

If you have any questions, please contact me at 609-275-4102 or tedelstein@njha.com.

Sincerely,

Theresa L. Edelstein, MPH, LNHA
Senior Vice President, Partnerships Transforming Health
New Jersey Hospital Association

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