BREAKING NEWS: President Signs Health Care Reform Bill

As we predicted in yesterday's advisory, today President Obama signed into law the Patient Protection and Affordability Act (H.R. 3590), the health care reform bill passed by the House on Sunday night. That bill becomes law today.

The Senate could take up debate as early as today on the Health Care and Education Reconciliation Act of 2010 (H.R. 3590), the reconciliation bill. The reconciliation bill includes various amendments and additions to the bill signed by President Obama today that were necessary to win the support of House members. Senate Republicans say they will challenge the reconciliation bill, but the Senate parliamentarian has already ruled against them on their lead argument to derail health care reform, a procedural argument that the bill violates the rules applicable to the reconciliation process.

As we discussed yesterday, many facets of the health care reform bill remain subject to change between now and 2012, 2013, 2014, and 2017 when the more substantive terms of the bill take effect. One facet of the bill--the extension of group health insurance benefits to dependent children under age 26--affects all employers offering group health insurance plans today.

We want to clarify this point because even on this narrow issue there are differences between the health care reform bill, which became law today, and the reconciliation bill, which continues to be debated. The health care reform bill (H.R. 3590) provides that group health insurance plans must immediately extend coverage to dependent children until they turn 26. That's the law as of President Obama's signature on it today. The reconciliation bill provides that dependent children remain eligible under the plan until the end of the tax year in which they turn 27. It's a nuanced distinction, but this batch of legislation is full of them. It's the eligibility until age 26 that employers must implement today.

Implementing this change will inevitably require amending SPDs and plan documents. Before you do so, we encourage you to contact your group health plan insurers and third party administrators and ask what they are doing to comply with the extension of benefits to dependent children under age 26. The insurers and TPAs are working together to provide a response to the new legislation and we expect best practices to emerge there first, while federal agencies will be slower to provide guidance.

Again, we encourage employers to keep a watchful eye on the progress of the reconciliation bill in the Senate. If health care reform is subject to further change--or even derailment--in the near term, it will happen when the Senate considers the reconciliation bill later this week.

Please continue to follow our Employment Law Advisories and keep in touch with your LMV attorney as this legislation progresses. If you have questions, please contact your LMV attorney at (205) 326-3002.