Although the Continuing Resolution (CR) approved this week by
Congress did not include a DACA fix, the bill did contain several
major policy riders that ordinarily would not be found in a
spending package. The legislation provides a six-year
reauthorization of the Children’s Health Insurance Program
(CHIP). And it delays the so-called ”Cadillac Tax”
associated with the Affordable Care Act.
Notably, and consistent with the long-term CHIP reauthorization
measures that had been pending in the House and Senate, the CR
phases down the Affordable Care Act’s (ACA) enhanced federal
matching rate for CHIP coverage. Specifically, and while HR
195 retains the ACA’s 88 percent federal contribution for
California through fiscal year 2019, the rate will be reduced to
76.5 percent in fiscal year 2020. Beginning in fiscal year
2021, the rate will return to its pre-ACA level of 65 percent.
ACA Tax on High-Cost Health Insurance Plans
The final CR temporarily delays the ACA’s 40 percent excise tax
on high-cost health insurance plans. The so-called
“Cadillac Tax,” which was slated to take effect in 2020, will now
be postponed until 2022. Many public employers, including
counties, offer high-value health plans that will be impacted by
the tax. With the excise tax costs expected to rise over
the years as health care expenses increase, the burden on county
budgets could be significant.
