House Republicans Push for Dynamic Scoring

As House Republicans seek to appoint a new Director of the Congressional Budget Office (CBO), they are expected to move to increase the use of dynamic scoring through a rules change that would require long-term estimates of the economic effects of major legislation. This long-desired change would require macroeconomic estimates to include the projected effects of legislation on economic output, employment, and capital stock. Such an assessment would ultimately estimate how a proposal would cause the economy to expand or contract. Only legislation that would produce a change in revenue, spending or deficits equal to or greater than 0.25 percent of gross domestic product (GDP) would qualify for such a macroeconomic score. Based on current GDP, 0.25 percent is about $45 billion. House Budget Chairman Tom Price (R-Ga.) is a strong proponent of the proposal, and introduced dynamic scoring legislation that was passed by the House during the 113th Congress.

CA Limits Application of Medical Liability Damage Cap

The Supreme Court of California has held that in medical professional negligence cases, the noneconomic damages cap applies only to “judgments,” or the amount of damages awarded to the plaintiff determined in court, but does not apply to settlements. Under the Medical Injury Compensation Reform Act of 1975 (MICRA), recovery of noneconomic damages is capped at $250,000 for professional negligence actions against healthcare providers. In the case of Rashidi v. Moser (filed 12/15/2014), the California Supreme Court ruled that the noneconomic damages cap does not require an offset of amounts received in settlement. This case comes shortly after California voters rejected a proposition to raise MICRA’s cap to $1.1 million.

Republicans Set to Target Employer Mandate

As of January 1, 2015, employers with at least 100 full-time workers will be required to meet certain standards for offering health insurance coverage to their workers, or face penalties in the coming year. The employer mandate was previously delayed twice by the White House in response to employer concerns about implementation of the mandate. Firms with at least 50 employees have until 2016 to offer insurance coverage. Changing the law’s definition of full time from a 30-hour workweek to 40 hours is a top priority for the new GOP majority. With the support of 18 Democrats, the House successfully voted to make this change during the 113th Congress, but the Senate did not advance the legislation. While introduction of a bill to change the definition of full time is expected early in 2015, finding offsets for such a change could prove difficult. The Congressional Budget Office (CBO) estimates that such change in definition would cost $46 billion over the next decade. This price tag, however, is much lower than the $74 billion estimated last year. Proponents of the change argue that the 30-hour workweek definition would prevent employers from cutting their employees’ hours in order to comply with the law.

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