The document discusses three proposals for reforming the Affordable Care Act from Trump's campaign, House Republicans, and Secretary of Health and Human Services Tom Price. It outlines key elements of each proposal, including repealing the individual and employer mandates, establishing tax credits for health insurance, and allowing cross-state purchasing. The document also examines potential changes to other welfare programs and the tax code under a Trump administration.

2. 2016 ACA (mis)Management:
What Everyone's Learned &
The Game Plan for 2017
Larry Grudzien
Attorney at Law

3. • Three Proposals
 Trump Proposals During the Campaign
 House GOP Proposals
 Price Proposal
• Possible changes
 Health Care Reform
 Other Welfare Benefits
 Individual Income Tax
 Retirement Income
 Executive Rewards
 Worker Protections
• Employer Next Steps
Copyright 2016 – Not to be reproduced without express permission of Benefit Express Services, LLC 3
Agenda

4. Three Proposals

5. Key Finding of Trump’s Proposals:
• His plan would significantly reduce income taxes and corporate taxes, and
eliminate the estate tax.
• His plan would reduce federal revenue by between $4.4 trillion and $5.9 trillion
on a static basis. The amount depends on the nature of a key business policy
provision.
• His plan would also significantly reduce marginal rates and the cost of capital,
which would lead to higher long-run levels of GDP, wages, and full-time
equivalent jobs.
• After accounting for the larger economy and the broader tax base, His plan
would reduce revenues by between $2.6 trillion and $3.9 trillion after
accounting for the larger economy, depending on the nature of a key policy
provision.
Copyright 2016 – Not to be reproduced without express permission of Benefit Express Services, LLC 5
Tax

6. Key findings:
• The plan reduces revenue by substantially less than his
plan proposed by Trump last year, on both a static and
dynamic basis.
• On a static basis, the plan would lead to at least 0.8
percent higher after-tax income for all taxpayer quintiles.
• The plan would lead to at least 10.2 percent higher
incomes for the top 1 percent of taxpayers or as much as
16.0 percent higher, depending on the nature of a key
business policy provision.
Copyright 2016 – Not to be reproduced without express permission of Benefit Express Services, LLC 6
Tax

7. Individual Tax:
• Consolidates the current seven tax brackets into three,
with rates on ordinary income of 12 percent, 25 percent,
and 33 percent
• Adapts the current rates for qualified capital gains and
dividends to the new brackets
• Eliminates the head of household filing status
Copyright 2016 – Not to be reproduced without express permission of Benefit Express Services, LLC 7
Tax

8. Copyright 2016 – Not to be reproduced without express permission of Benefit Express Services, LLC 8
Tax

9. Individual:
• Eliminates the Net Investment Income Tax
• Increases the standard deduction from $6,300 to $15,000 for singles
and from $12,600 to $30,000 for married couples filing jointly
• Eliminates the personal exemption and introduces other childcare-
related tax provisions
• Makes childcare costs deductible from adjusted gross income for most
Americans (above-the-line), up to the average cost of care in their
state. The deduction would be phased out for individuals earning more
than $250,000 or couples earning more than $500,000.
Copyright 2016 – Not to be reproduced without express permission of Benefit Express Services, LLC 9
Tax

10. Individual:
• Offers credits (“spending rebates”) of up to $1,200 a year for childcare
expenses to lower-income families, through the earned income tax
credit
• Creates new saving accounts for care for children or elderly parents,
or school tuitions, and offers a 50 percent match of contributions (not
modeled)
• Caps itemized deductions at $100,000 for single filers and $200,000
for married couples filing jointly
• Taxes carried interest as ordinary income
• Eliminates the individual alternative minimum tax
Copyright 2016 – Not to be reproduced without express permission of Benefit Express Services, LLC 10
Tax

11. Business:
• Reduces the corporate income tax rate from 35 percent to
15 percent
• Eliminates the corporate alternative minimum tax
• Allows firms engaged in manufacturing in the U.S. to
choose between the full expensing of capital investment
and the deductibility of interest paid
Copyright 2016 – Not to be reproduced without express permission of Benefit Express Services, LLC 11
Tax

12. Business:
• Eliminates the domestic production activities deduction
(section 199) and all other business credits, except for the
research and development credit
• Enacts a deemed repatriation of currently deferred foreign
profits, at a tax rate of 10 percent
• Increases the cap for the tax credit for employer-provided
day care under Sec. 205 of the Economic Growth and Tax
Relief Reconciliation Act of 2001 from $150,000 to
$500,000 and reduces its recapture period from 10 years
to 5
Copyright 2016 – Not to be reproduced without express permission of Benefit Express Services, LLC 12
Tax

13. • Repeal the ACA. President-elect Trump has vowed to completely
repeal the ACA as his first order of Presidential business
• Allow health insurance to be purchased across state lines
• Allow individuals to fully deduct health insurance premium payments
from their tax returns
• Allow individuals to use health savings accounts (HSAs) in a more
robust way than regulation currently allows. President-elect Trump’s
proposal specifically mentions allowing HSAs to be part of an
individual’s estate and allowing HSA funds to be spent by any member
of the account owner’s family.
Copyright 2016 – Not to be reproduced without express permission of Benefit Express Services, LLC 13
Benefits

14. • Require price transparency from all healthcare providers
• Block-grant Medicaid to the states. This would remove federal
provisions on how Medicaid dollars can and should be spent by the
states.
• Remove barriers to entry into the free market for the pharmaceutical
industry. This includes allowing American consumers access to
imported drugs.
• Postponement or elimination of the recently issued Department of
Labor fiduciary regulations
• Loosening of executive compensation rules
• Further cutbacks in IRS guidance and audit activity
Copyright 2016 – Not to be reproduced without express permission of Benefit Express Services, LLC 14
Benefits

15. Increased hostility to consideration of noneconomic factors
in selecting retirement plan investments
Increased activity at the state level, including establishment
of state-sponsored retirement plans for private employers
Copyright 2016 – Not to be reproduced without express permission of Benefit Express Services, LLC 15
Benefits

16. • A hiring freeze on all federal employees, to reduce federal
workforce through attrition (exempting military, public
safety, and public health)
• A requirement that for every new federal regulation, two
existing regulations must be eliminated
• Cancel every “unconstitutional” executive action,
memorandum and order issued by President Obama
• Affordable Childcare and Eldercare Act
• Executive Compensation
Copyright 2016 – Not to be reproduced without express permission of Benefit Express Services, LLC 16
Trump’s Other Proposals

17. • Expands flexibility of HSAs
• Prohibits pre-existing condition exclusions
• Requires standard premium rates of individuals with
continuous prior coverage, regardless of applicant’s
medical conditions
• Provided one-time open enrollment
• Allows dependents up to age 26 to stay on their parent’s
plan
Copyright 2016 – Not to be reproduced without express permission of Benefit Express Services, LLC 17
House GOP Plan

18. • Bars the practice of imposing lifetime coverage limits on
individuals
• Bans coverage rescission and cancellations, except in
certain circumstance
• Provide monthly refundable tax credit to purchase
coverage
• Caps employee’s annual income tax exclusion at a level
that would ensure continued job coverage
Copyright 2016 – Not to be reproduced without express permission of Benefit Express Services, LLC 18
House GOP Plan

19. • Makes it easier for states to enter in interstate compacts
for pooling
• Allows people to purchase a plan licensed in another state
• Changes current federal Medicaid funding
• Combines Medicare Parts A &B
• Beginning in 2020 , increases eligibility age for Medicare
benefits to align with eligibility age for Social Security
Copyright 2016 – Not to be reproduced without express permission of Benefit Express Services, LLC 19
House GOP Plan

20. • Beginning in 2024, give Medicare beneficiaries a choice of
private plans or traditional Medicare program on a newly
created Medicare exchange
• Imposes caps on noneconomic damages
• Provides 25 billion in federal funding for state risk pools
• Modifies rules for wellness programs
Copyright 2016 – Not to be reproduced without express permission of Benefit Express Services, LLC 20
House GOP Plan

21. Encourages HSAs
• Provides a one time credit
• Increase maximum contribution
• Allows rollovers from FSAs to HSA
• Allows HSA contributions for those covered by TRICARE
or Medicare Part A
Provides enhanced premium and benefit protections in
individual marker with continuous coverage
Copyright 2016 – Not to be reproduced without express permission of Benefit Express Services, LLC 21
Price Plan

22. • Provides advanceable refundable annual credits adjusted for age to
purchase individual market policies
• Allows individuals to decline Medicare, Medicaid, TRICARE and Vet
benefits in favor of credits
• Caps employee’s annual income tax exclusion are $8,000 individual/
$20,000 for family
• Allows employees to use pretax employer dollars to purchase
individual market policies
• Allows insurers licensed in one state to sell policies to residents of any
state
• Authorizes interstate compacts to enable cross-border sales
Copyright 2016 – Not to be reproduced without express permission of Benefit Express Services, LLC 22
Price Plan

23. • Repeals all ACA Medicaid/CHIP provisions, including
Medicaid expansion
• Eliminates current restrictions on certain physician
charges payable by Medicare patients
• Change legal of proof for establish medical malpractice
• Allows individuals and small businesses to band together
to buy health insurance
• Increases HIPAA wellness incentive maximum to 50% of
the coverage cost
Copyright 2016 – Not to be reproduced without express permission of Benefit Express Services, LLC 23
Price Plan

24. Possible Changes

25. • Employer Mandate
• Individual Mandate
• Reporting (1094 1095)
• Nondiscrimination rules
• Cadillac tax
• Essential Health Benefits –small plan market
• Preexisting Conditions
• Expansion of Medicaid
Copyright 2016 – Not to be reproduced without express permission of Benefit Express Services, LLC 25
Health Care Reform

26. • Dependent Age 26
• Marketplace
• Full-time Employee definition
• Health FSA Limitation
• Free standing HRAs
Copyright 2016 – Not to be reproduced without express permission of Benefit Express Services, LLC 26
Health Care Reform

27. • Eliminate the expansion of Form 5500 reporting
• Wellness rules
• Contraceptive Coverage
• Gender transition services
Copyright 2016 – Not to be reproduced without express permission of Benefit Express Services, LLC 27
Other Welfare Benefits

28. • Allow the deduction of individual premium
• Limit or eliminate deductions
• Eliminate credits to broaden tax base
Copyright 2016 – Not to be reproduced without express permission of Benefit Express Services, LLC 28
Individual Income Tax

29. • Rollback or eliminate fiduciary rule
• Weaken financial disclosure protections
• Expand multiple employer plans
• Encourage state IRA initiatives
Copyright 2016 – Not to be reproduced without express permission of Benefit Express Services, LLC 29
Retirement Income

30. • Repeal or Modify Dodd-Frank
• Lower tax rete could bake deferred compensation plans
less attractive
• Elimination of alternative minimum tax could make
incentive stock options more attractive
Copyright 2016 – Not to be reproduced without express permission of Benefit Express Services, LLC 30
Executive Rewards

31. • Repeal or replace DOL final overtime rules
• Slow Increases minimum wage
• Delay any pay equity and equal employment opportunity
issues
• Leave Paid Leave to state and local
• Lessen enforcement of Independent contractors and the
gig economy
Copyright 2016 – Not to be reproduced without express permission of Benefit Express Services, LLC 31
Worker Protections

32. Employer-sponsored healthcare
• Mandates may stay in place for 2017
• Reporting in place for 2016, but for 2017?
• HSAs and HRAs may be favored
Retirement income
• Reporting and fiduciary rule may change
• Limits may change
• Roth may not be favored
Copyright 2016 – Not to be reproduced without express permission of Benefit Express Services, LLC 32
Employer Next Steps

33. Executive rewards
• Disclosure rules may be lessen
• With lower taxes, cash may be preferred
Worker protections
• Overtime rules –take time to repeal
• Minimum wage and pay equity pressure off
• Paid leave –watch state and local developments
Copyright 2016 – Not to be reproduced without express permission of Benefit Express Services, LLC 33
Employer Next Steps

34. Questions?

35. Larry Grudzien
Attorney at Law
(708) 717-9638
larry@larrygrudzien.com
www.larrygrudzien.com
Copyright 2016 – Not to be reproduced without express permission of Benefit Express Services, LLC 35
Contact Information