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Promo Industry Reacts To Looming ACA Changes

Spurred by its Republican majority, Congress has taken significant steps toward repealing the Affordable Care Act (ACA), while President-Elect Donald Trump says he is finalizing a healthcare plan that would replace the legislation commonly known as Obamacare. Just when repeal might occur and what shape healthcare reform will take remains a mystery, though executives and business owners in the promo products industry are monitoring the situation with both hope and concern.

Last week, the U.S. Senate and House of Representatives passed resolutions that instruct key committees on Capitol Hill to draft, by January 27, legislation for the repeal of the ACA. Voting largely fell along party lines, with Democrats opposing repeal and Republicans eager for it. In the House, for example, the resolution passed 227 to 198, with nine Republicans and no Democrats crossing party lines. “By taking this first step toward repealing Obamacare, we are closer to giving Americans relief from the problems this law has caused,” House Speaker Paul Ryan said in a statement. “Too many families have seen costs soar, quality drop, and choices reduced to one – which just isn’t a choice at all.” Both the Senate and House would have to vote in favor of a repeal bill for the Affordable Care Act to be rubbished.

Meanwhile, over the weekend, Trump told The Washington Post that his plan for replacing Obamacare was nearly complete. While declining to reveal specifics, the president-elect said his plan focuses on lowering healthcare costs and providing “insurance for everybody.” He also pledged to target pharmaceutical companies on drug pricing, and to get the corporations to negotiate directly with the government on prices in Medicare and Medicaid. Trump said he would reveal his plan after his nominee for secretary of health and human services, Rep. Tom Price, was confirmed. It’s unclear when the confirmation will occur, with some reports saying it might not happen until late February.

In the advertising specialty industry, executives and business owners are keen for healthcare reform that lowers costs for employers and employees, while providing quality coverage for those enrolled. “The ACA has been pretty devastating to the profitability of companies, especially small businesses,” said Brandon Mackay, CEO/president of SnugZ USA (asi/88060). Mackay, like others, would like reform to include measures that modify existing law that inhibits the sale of health insurance across state lines. Opening up cross-state sales could increase competition, potentially lowering rates, and even creating opportunity for distributors. “You could have companies scrambling to gobble up territory,” said Matt Gledhill, VP of sales and marketing at Walker Advertising (asi/354440). “They could dump a lot of money into their marketing.”

Other owners desire reform to include tax breaks for companies of less than 50 employees that offer employees health insurance. “Something more than a write-off would be welcomed,” said Vicki Clayman, CEO of Partners N Promotion (asi/350153).

Given all the uncertainty surrounding changes to healthcare law, many industry executives remain leery of how things will play out. They raise concerns about everything from potential negative impact on stock markets to requirement upheavals that create paperwork nightmares for businesses. “Given the overall uncertainty about what any new healthcare legislation could look like, it’s difficult to tell what impact it could have on the healthcare market in our industry,” said Greg Muzzillo, founder of Proforma (asi/300094).