Another Obamacare “Tweak” Needed So Church Employees Can Get Insurance

August 11th, 2013

A “glitch” in the Affordable Care Act prevents tax credits to be used to purchase special insurance plans for churches.

An effort to tweak President Obama’s health care reform bill to fill a gap for church health insurance plans could fail because of Republicans’ insistence on repealing the law.

Without a fix, United Methodist Church leaders say some of their churches could drop current coverage for employees once “Obamacare” takes full effect next year, according to Colette Nies, spokeswoman for the UMC’s General Board of Pension and Health Benefits.

Under Obama’s 2010 Affordable Care Act, more than 50 percent of UMC clergy would qualify for tax credits available to lower- and middle-class families to purchase insurance. But because of the way the law was written, those tax credits cannot be used toward insurance plans churches can offer through government-run exchanges.

“The concern is that the church plans won’t be viable if everyone who can get a tax credit leaves and goes to the state exchange,” said Timothy Jost, a professor at Washington and Lee School of Law, who studies health care.

A bill has been introduced to tweak this glitch. But, as with all changes to the ACA, none will go through. We are stuck with the draft version of this bill from 2009.

A bill under consideration would assure that employees insured under church plans could use the same tax credits offered to people on government exchanges. In June, Democratic Senators Mark Pryor (Ark.) and Chris Coons (Del.) introduced the Church Health Plan Act of 2013 aimed at allowing church employees to apply for tax credits. More than 1 million pastors and other church employees could be impacted by the change, the senators argue.

“At this moment, we’re not expecting to get a vote,” said Ian Koski, a spokesman for Coons. “The dedication of Senate and House members to repeal it entirely instead of working with us to fix it has disincentivized Republicans from working with us on it.”

“It doesn’t stand a chance, I don’t think,” said Jim Sargent, the health plan director for the Unitarian Universalist Association. “This is the Obama administration’s signature piece of legislation. Republicans are trying to undermine it. While that’s going on, there isn’t much you can do to fix the bill.”

I expect many of these unfixable glitches to continue to pop up.

H/T Religion Clause