Republicans seemed to have the wrong public official on the stand Wednesday during a hearing organized by the Senate Small Business and Entrepreneurship Committee.
Committee leaders organized the hearing to talk about the effects of the Patient Protection and Affordable Care Act (PPACA) commercial health insurance provisions on small businesses.
Republican senators, and Republican witnesses from the business world, focused on supporting S. 1697, the Small Business Healthcare Relief Act bill. The bill would let small employers reimburse employees for health insurance premium costs.
Federal regulations now keep small employers from using health reimbursement arrangements (HRAs), cafeteria plans or other arrangements to give employees cash they can use to pay for their own individual major medical coverage.
The only witness from the Obama administration, Richard Frank, the assistant secretary for planning and education at the U.S. Department of Health and Human Services (HHS), said HRAs and health savings accounts (HSAs) are under the purview of the U.S. Treasury Department.
“I’m not really that familiar with the details of those,” Frank said at the hearing, which was streamed live on the Web.
PPACA does not require small employers to offer health coverage, or impose any penalties on small employers that fail to do so. Small employers can still offer HRAs and HSAs along with major medical coverage.
Federal agencies have ruled, however, that any efforts to use HRAs to pay a limited amount of cash for each employee’s health coverage would violate the PPACA ban on annual and lifetime health benefits limits.