Free Choice Voucher Provision Repealed

We have another update regarding the Patient Protection and Affordable Care Act - this time regarding the employee free choice voucher provision. President Obama just signed HR 1473, which eliminated this provision. This is another change in the provisions of health care reform.

The provision would have taken effect in 2014. Employers would have been required to provide qualified employees with a voucher to be used in state exchanges when purchasing health coverage. The amount of the voucher would have been determined by the health plan offered by the employer. If the exchange coverage cost less than the voucher amount provided by the employer, the employee would have kept the excess contribution. Any excess amounts would have been tax-deductible for employers but taxable to the employee.

Employers would not have been penalized under the employer mandate (effective in 2014 and also known as the pay or play penalty) for any employee who was provided with a voucher. It is important to note that the employer mandate, requiring employers to pay a penalty for not offering coverage or offering coverage deemed to be unaffordable, was not repealed as part of HR 1473.

If you have further questions about the new law, please contact your Account Manager or Account Executive.