Keep It Simple, Silly

By: John Stanford, WIPP Government Relations

It’s a favorite phrase of my boss – and WIPP’s Chief Advocate – Ann Sullivan. The idea is nothing new: a simple solution is usually the best. That is why, for years, women business owners used the simplest possible idea for providing health benefits – you (employee) go out and get your own insurance and I (employer) will reimburse you. Simple, right?

They are called Healthcare Reimbursement Arrangements, or HRAs, and bringing them back (for the second time) is one of WIPP’s top healthcare priorities. We are making great progress. The House Ways and Means Committee approved legislation that would allow HRAs to be used for firms with fewer than 50 employees. The House as a whole is expected to vote on the bill next week.

The bill would allow employers to reimburse employees for qualified medical expenses like premiums and out-of-pocket costs. Importantly, employers must offer it to all eligible employees and cannot offer a separate group plan. The reimbursement is capped at around $5,000 for an individual and $10,000 for families and does not count as employee income (meaning no taxes!).

Again, the idea is simple. Employers select an amount to reimburse employees, instead of locking in an insurance plan that may not fit their employees or their budget. But why did we lose HRAs in the first place? That is not so simple.

The Affordable Care Act eliminated caps on health insurance plans—an undoubtedly good thing for when disaster or disease strikes. But, in the opinion of the IRS, these HRAs, by definition, had a cap (however much the employer contributed). So they were outlawed in 2013 or 2014.

2013 or 2014 is a strange way to describe when the IRS banned a certain healthcare plan. But that is what it was – the IRS notices on the issue were so confusing they had to issue additional regulations three times. Policy wonks, insurers, and healthcare consultants were unsure – let alone business owners – about whether they were allowed. And making a mistake on this carries severe penalties; offering a non-conforming plan can trigger a penalty of $100 per day per employee –more than $350,000 a year for a company with 10 employees.

Because of this confusion WIPP stepped in asking Secretary Burwell to intervene on behalf of women business owners. She did and HRAs were allowed through June 2015. Legislation is needed to bring them back permanently and WIPP is optimistic Democrats and Republicans can work together, as they already have, to get this done. After all, ten million women business owners and their nearly ten million employees are pretty active voters.

It’s pretty simple.

More on how WIPP is working with Congress and the Administration to bring competitively-priced and accessible health options to women business owners is in our blog, Making the Affordable Care Act Work.

469 Reasons To Follow Congressional Elections

By: Aaron Richards, WIPP Government Relations Intern

Amid a captivating Presidential primary season – with a cast of characters as diverse as ever – it has been easy to forget the 469 other federal elections happening this November. Overlooking some of these critical races is a mistake for advocates looking to change policy under the next Administration. After all, it is Congress – and not the President – that holds the “power of the purse” and the ability to advance or block any White House agenda.

The stakes for Congressional elections are enormous. With every House seat and a third of the Senate up for reelection, Republican and Democratic lawmakers have dreams of controlling the 115^th Congress.

We know the next Congress will look different than this one. Three incumbents have already lost in their primary elections including Virginia Rep. Randy Forbes.  The loss of the 7-term Congressman from Newport News, VA is notable. His tenure as chair of the House subcommittee overseeing the Navy is considered a key reason the region received numerous Navy contracts. The impact of his removal could be significant for federal contractors in his District. Look out for other upcoming primary elections on June 28th in New York, Oklahoma, South Carolina, and Utah.

On a larger scale, these elections may change control of the House or Senate. Historically, Congressional elections during a Presidential election year are likely to have a higher voter turnout, which has recently benefitted Democrats – who control neither chamber. In the Senate, where Democrats currently hold 44 of the 100 seats, only 10 Democrats are up for reelection. Republicans, however, have a steeper climb to maintain their current Senators. Of their 54 seats, 24 face Democratic challengers in November.

Democrats are trying to pick up at least 5 seats to regain control of the Senate. Strategists are targeting Republican incumbents in Illinois, Wisconsin, New Hampshire, Ohio, and Pennsylvania as well as an open Republican seat in Florida (though at time of writing rumors swirl about Senator Rubio reconsidering running).

Given the large majority of seats the GOP has in the House, most experts think Republicans have a strong chance of maintaining control. Just to be safe, Republicans have intensified fundraising to help defend that majority. Finally, Republicans have historically held most seats up for reelection in the House.

With the final slate of primaries wrapping up, the field is almost set for the nearly 500 elections that will make up the federal government in 2017. One race in particular – between the nation’s first female candidate (of a major party) and an outspoken business leader – has dominated the news cycle. But for WIPP, as advocates hoping to shape policy, the Congressional elections warrant as much attention. We rarely (in fact never) make lofty predictions about the outcome – and with 5 months, hundreds of debates, thousands of commercials, millions of dollars, and any number of other unpredictable events that could change the calculus before November, there is no reason to start now.

Congress Split on Entrepreneurship Funding

By: Jake Clabaugh

With August recess (which actually begins mid-July) fast approaching, Congress is working feverishly to produce appropriations bills for the coming fiscal year. Both chambers– the House and the Senate – draft separate funding bills, which are then merged into the final funding levels presented to the President. As with most years, differences between the House and Senate dollar amounts for entrepreneurial programming government-wide will need to be addressed before the FY2017 funding amounts are known.

The chart below compares current spending levels with AEO’s requests for FY17 and highlights the differences in funding from both bill versions:

Program	FY 2016 - Enacted Level	AEO's FY17 Requests	FY17 -  House Version	FY17-Senate Version
Treasury CDFI Fund	$233.5 million	$246 million	$250 million	$233.5 million
Treasury CDFI BGP	$750 million	$1 billion	$250 million	$500 million
Microloan Program Lending	$35 million	$44 million	$44 million	$44 million
Microloan Program Technical Assistance	$25 million	$31 million	$31 million	$25 million
Prime Program	$5 million	$10 million	$5 million	$0
Women’s Business Centers	$17 million	$21.75 million	$19 million	$17 million

Microlenders have reason to celebrate as SBA’s program received $44 million in lending authority from both the House and Senate— a 25% increase from FY16. That program, however, is the only agreement between the two. The House provided a 25% increase for Microloan TA to $31 million, but the Senate kept funding at last year’s level of $25 million.

The Women’s Business Center (WBC) program would get an additional $2 million in the House legislation, bringing their FY17 proposed total to $19 million from the FY16 $17 million. The Senate maintained that figure in their proposal. Notably, though, both the House and Senate increased their FY16 proposals by $2 million (the Senate was at $15 million in their previous, unaccepted legislation), highlighting the growing support for the much-needed program.  

On again, AEO’s efforts to save the PRIME program were successful in the House, which funded the program at $5 million. The Senate’s spending bill did not address the PRIME program, but the Senate has not provided funding for this program in previous years. Typically, the House numbers for this program have usually prevailed.

The funding for the Department of Treasury’s Community Development Financial Institutions (CDFI) fund and Bond Guarantee Program (BGP) similarly has each chamber on a different page. The House, which in recent years has not provided specific authority for the CDFI Bond Guarantee Program, broke that trend this year with a $250 million guarantee—falling well short of AEO’s $1 billion request. The Senate bill allowed for $500 million for the program.

Advocacy work will be critical during the upcoming months. AEO seeks to ensure that resources exist for the programs members rely on to reach microbusinesses and entrepreneurs. Attaining sufficient funding for vital entrepreneurial development programs takes passion and commitment. The good news is that AEO members have both.