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First Acts of the Trump Administration - Executive Order Pertaining to the Affordable Care Act (ACA), and a Regulatory Freeze Memorandum

Author: Jody Rodney/Thursday, February 2, 2017/Categories: News

As its first acts, on January 20, 2017, the Trump Administration issued  a memorandum freezing federal regulations that have not yet taken effect, and  an executive order authorizing agencies and departments to "minimize the unwarranted economic and regulatory burdens" of the Affordable Care Act.  It is not uncommon for incoming administrations to act swiftly. More about the regulatory freeze and ACA Executive Order can be found below.

Regulatory Freeze.

Overview.   The January 20, 2017 Memorandum issued by the President’s Chief of Staff to all Executive Branch departments and agencies entitled, ”Regulatory Freeze Pending Review” provides in relevant part:

1.    Subject to exceptions for emergency situations relating to health, safety, financial, or national security matters, federal agencies are to produce no new regulations until the new department or agency head appointed or designated by President Trump approves the regulation. 

2.    Pending regulations that have not been published in the Federal Register will be withdrawn for review and approval.

3.    The effective date of regulations that have been published in the Federal Register but have not taken effect, are to be temporarily postponed for 60 days  (March 24, 2017) as permitted by law and subject to exceptions for  emergency situations relating to health, safety, financial, or national security matters.  The purpose of the postponement is to determine if the regulations raise questions of fact, law or policy.  Government agencies are also directed to consider whether additional delay is appropriate and whether new rules should be proposed for public notice and comments. Agencies are directed to consult with the Office of Management and Budget (OMB) concerning regulations that raise substantial questions of law or policy.

Practical Impact.  For employers, this “freeze” means that a number of rules that have not yet taken effect may be delayed consistent with category number three above.   This could include the recently expanded EEO-1 reporting requirements  as the effective date for filing is technically not until March 31, 2018.  This could also include those rules with an effective date that has been blocked by a court order such as, the final rule changing the Fair Labor Standards Act’s white collar exemptions  that was set to take effect December 1, 2016, but was halted by a November 22, 2016 Court Order, and the disclosure and arbitration provisions of the Fair Pay and Safe Workplaces Executive Order  the October 26, 2016 implementation of which was halted by an October 24, 2016 Court Order.  

ACA Executive Order.

Overview and Practical Impact. The January 20, 2017 Executive Order,  entitled “Minimizing the Economic Burden of the Patient Protection and Affordable Care Act Pending Repeal,”   states that it is the policy of the new administration to seek the prompt repeal of the ACA, and sets forth how, in the meantime, the burden on employers should be minimized.  ADP  issued an Eye on Washington on January 23rd, and Comprehensive Services clients received an Alert on January 24th, both of which cover the details of the Executive Order. So as not to be redundant, links to these articles have been provided for your convenience.

It is worth reiterating that the Executive Order does not change the legal status of the ACA. Until further guidance is issued, it is important to remember that all rules and regulations relating to the individual and employer mandates, as well as to information reporting by employers and insurers, remain in place and the IRS retains its ability to penalize employers that do not accurately and timely file all ACA forms.

Webcasts.

As a reminder, on January 31, 2017, ADP Presented New Year, New Changes to HR and Tax Compliance (Ellen Feeney and Pete Isberg). The recording can be accessed   by clicking the link.

On February 15, 2017, ADP will present Employment and Benefits Trends and the New AdministrationYou are encouraged to register even if you cannot attend, as you will receive a link to the recording in a follow – up email.

As always, please contact Relationship Manager or Service Team if you have questions.