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State lawmakers approve restaurant bill, hospital settlement – but Obamacare dealt blow by U.S. appeals court

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As expected, state lawmakers have approved Connecticut’s settlement of a lawsuit filed by the state’s hospitals and passed legislation clarifying how restaurants should pay tipped waiters and bartenders when they are doing nontipped work.

House Bill 7501, “An Act Concerning the Workforce Training Needs in the State and Revisions to and Regulation of Gratuities Permitted or Applied as Part of the Minimum Fair Wage,” was passed by the House by a 125-11 majority and by the Senate by a 27-3 vote.

It now goes to Gov. Ned Lamont, who vetoed similar legislation in July. He now is expected to sign HB 7501 into law.

The governor said the legislation “strikes the appropriate balance to protect the wages fairly earned by restaurant workers while providing relief to restaurant owners who may have complied with unclear or conflicting guidance from the prior administration’s Department of Labor.”

restaurant tip health care ObamacareMeanwhile, both chambers unanimously passed two bills detailing the settlement and the implementation of the state’s settlement of the hospital lawsuit, which was announced earlier this month.

The settlement will cost the state $872 million over seven years, while the hospitals will receive $1.8 billion over the same period.

Lamont called the agreement “a desperately needed reset between the state and our hospitals” that “eliminates the state’s potential exposure to billions of dollars in liability and removes fiscal uncertainty for years to come.”

“This is a fair and reasonable settlement that limits and manages the state’s long-term risk and provides both the state and hospitals with predictability when it comes to user- fee and Medicaid rates over the next seven years,” state Attorney General William Tong said.

“Today marks the start of a new partnership with the state that will strengthen health care in Connecticut for the benefit of everyone who lives here,” Connecticut Hospital Association CEO Jennifer Jackson said.

Soon after the ratification of the hospital agreement came word that a federal appeals court has ruled that the Affordable Care Act’s individual mandate is unconstitutional, in light of the U.S. Congress’ elimination of the tax penalty that was intended to enforce it.

The 5th Circuit U.S. Court of Appeals in New Orleans sent the issue back to the Federal District Court in Fort Worth to rule on whether other aspects of the ACA, or Obamacare, should remain in place. Such a ruling is unlikely to occur before the 2020 election.

“The most important thing to understand is that for now, nothing changes,” said Patricia Baker, president and CEO of the Connecticut Health Foundation. “The open enrollment period to buy health insurance for 2020 through Access Health CT, the state’s health insurance exchange, remains in effect (through Jan. 15), and federal financial aid is still available to help people pay for their coverage. The existing rules about coverage still apply.”

Baker also noted that overturning the entirety of the ACA “would have significant effects on Connecticut residents.”

A 2017 report on the impact of the ACA in Connecticut identified effects on nearly everyone in the state. Among the findings in the report, which was commissioned by the Connecticut Health Foundation and produced by the Urban Institute:

  • More than 160,000 state residents – 5.4% of the population under 65 – had health care coverage because of the health law and would likely be uninsured without it.
  • People of color were especially likely to have benefited from the health law; of those who gained coverage because of the ACA, 46 percent were people of color.
  • 1.9 million people with employer-sponsored insurance gained zero-copay preventive care, protection from catastrophic costs because of the law’s ban on lifetime coverage limits, and immediate access to health insurance if they lose job-based coverage.
  • Connecticut residents covered by Medicare gained access to annual physicals, mammograms, colonoscopies, and other preventive services with no out-of-pocket charges, as well as significantly more coverage for prescription drug costs by reducing the “donut hole.”

“We will continue our fight against the attack on our nation’s health care system and the millions of Americans who have gained coverage and quality healthcare under the Affordable Care Act,” declared Tong. “For the 250,000 Connecticut residents who have benefited from the expansion of Medicaid, to the thousands of young adults under the age of 26 who now have insurance, to the nearly half a million residents with pre-existing conditions, life without health care is not an option.”

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