Health, retirement legislation in limbo as government funding talks stall 

With time running short, the fate of eagerly awaited health and retirement legislation remains uncertain as lawmakers struggle to agree on a government spending package that could carry the legislation over the finish line.

Government funding is set to run out Dec. 16, though many expect a short-term bill to keep the government running at least through Dec. 23 to give lawmakers more time to resolve differences over detailed appropriations legislation that would fund the government for the full 2023 fiscal year.  That legislation will likely need to be the vehicle for several year-end employer policy priorities, including renewal of expiring telehealth flexibilities, bolstering the nation’s mental health care system, and enacting a major package of “SECURE 2.0” retirement reforms.

But as appropriations bill negotiators continue to disagree on top-line spending numbers, House and Senate leaders are now allowing for the possibility that Congress could pass a stopgap “continuing resolution” to fund the government into next year.  That measure would largely extend existing spending levels and may carry few if any additional benefits-related proposals, leaving the next Congress to start from scratch. 

Meanwhile, employer groups and Mercer continue to urge Congress to extend the flexibility for HSA-eligible high-deductible health plans to offer telehealth services prior to a patient paying through their deductible, which expires at year-end, and to continue allowing employers to offer stand-alone telehealth coverage separate from their group health plan. While pending bipartisan legislation (HR 5981, HR 7353) would make these changes permanent, Congress is considering temporary extensions of a least one year.   

If Congress doesn’t act, high-deductible plans wouldn’t be able to cover telehealth visits before patients hit their deductibles after Dec. 31.  Congress first allowed pre-deductible virtual visits in the March 2020 CARES Act relief package to help people see their doctors during the pandemic.

Employers are also urging action on and reauthorizing and reforming numerous mental health programs that were included in the House-passed Restoring Hope for Mental Health and Well-Being Act (HR 7666). The bill wouldn’t directly affect private employers’ programs but would require self-funded, nonfederal governmental plans to comply with mental health parity laws. It would also require pharmacy benefit managers (PBMs) to report a wide range of data about their business practices to plan sponsors and the government at least every six months. Reportable data would include how the PBM sets rebates and discounts and what it pays for drugs. These proposals stand a chance of being included in any year-end health care package.  

Less likely to make the cut are bills that would cap consumers’ out-of-pocket costs for insulin in the commercial market, require employer plans to cover kidney dialysis benefits on par with benefits for other chronic medical conditions, and create new civil monetary penalties for mental health parity violations.

Also vying to be added to an omnibus spending bill is sweeping “SECURE 2.0” retirement legislation. Negotiators say a final retirement bill is almost ready, but the difficulties of moving a stand-alone measure through the Senate means its fate likely depends on completion of a full-year spending bill before a new, divided Congress convenes on Jan. 3.