Key Workforce Development Legislation Still a Work-in-Progress

In the Indiana General Assembly, both House Bill 1002 and Senate Bill 50 have been significantly amended in ways that we support, but also in ways that give us some concern. We have strong support for the thoughtful and deliberate work on the study by the Legislative Service Agency of all workforce programs. It is extremely thorough and we look forward to the results of each year’s report and presentation. We also support the language regarding the Next Level Jobs Employer Training Grant program. The career and technical education (CTE) student information portal for local employers is a prime example of a creative model without having to spend extra capital. And we also support expanding the Employment Aid Readiness Network (EARN) Indiana program to include part-time students.

We hope to continue the conversation on the makeup of the Governor’s Workforce Cabinet in conference committee and have some questions as to how this will work in conjunction with the State Workforce Innovation Council (SWIC), a similar existing cabinet that is required to have its membership be 50% employers. We appreciate the language in the bill allowing the Indiana Chamber to be consulted with on a gubernatorial appointment for a business leader to the panel; however, we question why we cannot simply utilize the SWIC.

If we are tied to the idea of creating a new cabinet, we feel strongly that we should have more employer voices at the table, plus give the Indiana Chamber a seat as well. The Chamber’s place on the cabinet would provide historical knowledge on workforce issues, representing the voices of thousands of members and investors throughout the state and providing consistency when we have a new Governor who would make the majority of the appointees (be they employers or agency heads).

In close, though these bills are better and moving in the right direction, they still need work. The Chamber will continue to advocate for strong policies throughout conference committee.

Walorski Pushes for New Repeal of Medical Device Tax; Messer’s Reverse Transfer Concept Amended Into Reauthorization Bill

Congresswoman Jackie Walorski (IN-02) has brought forth legislation to suspend the medical device tax for five years. She joined Rep. Erik Paulsen (R-MN) in co-authoring the bill, H.R. 4617, which would delay the implementation of the 2.3% tax that was originally created through the Affordable Care Act. In 2017, Congress delayed the tax for two years, but without intervention it is set to take effect January 1, 2018.

“The job-killing medical device tax would have a devastating impact on Hoosier workers and patients across the country who depend on life-saving medical innovation,” Walorski said. “I am committed to permanently ending this burdensome tax. As we continue working toward repeal, we must protect workers and patients by preventing it from taking effect.”

Congressman Luke Messer (IN-06) and Congresswoman Jackie Walorski (IN-02)

Walorski’s bill was part of a group of legislation introduced by members of the House Ways and Means Committee aimed at stopping Obamacare taxes set to take effect in 2018. The other four measures are:

• H.R. 4618, introduced by Rep. Lynn Jenkins (R-KS), provides relief for two years from the tax on over-the-counter medications, expanding access and reducing health care costs by once again allowing for reimbursement under consumer-directed accounts;
• H.R. 4620, introduced by Rep. Kristi Noem (R-SD), provides relief in 2018 from the Health Insurance Tax (HIT) that drives up health care costs;
• H.R. 4619, introduced by Rep. Carlos Curbelo (R-FL), provides needed relief from HIT for two years for health care plans regulated by Puerto Rico; and
• H.R. 4616, introduced by Reps. Devin Nunes (R-CA) and Mike Kelly (R-PA), delivers three years of retroactive relief and one year of prospective relief from the harmful employer mandate paired with a one-year delay of the Cadillac tax.

Earlier this year, Congressman Luke Messer (IN-06) introduced legislation that encourages a more seamless transition for community college transfer students earning degrees. Messer’s proposal would make it easier for students to earn a degree through a “reverse transfer,” where students who transferred from a community college to a four-year-institution but haven’t completed a bachelor’s degree can apply those additional credits back toward an associate’s degree.

Originally titled the Reverse Transfer Efficiency Act of 2017, it was recently added as an amendment to the Higher Education Re-authorization by the House Committee on Education and Workforce. The provision would streamline credit sharing between community colleges and four-year institutions so transfer students can be notified when they become eligible to receive an associate’s degree through a reverse transfer.

“An associate’s degree can make a huge difference for working Hoosiers,” Messer said. “By making it easier for transfer students to combine credits and get a degree they’ve earned, Hoosiers will have more opportunities to get good-paying jobs and succeed in today’s workforce.” This legislation was supported not only by the Indiana Chamber, but also by Ivy Tech Community College and the Indiana Commission for Higher Education.

Indiana Would Be Hit Hard by NAFTA Pullout

The U.S. Chamber recently released its analysis of which states would be most harmed from a NAFTA withdrawal.

Unfortunately, Indiana would be among the Top 10 most hard hit states, with more than 250,000 Hoosier jobs put at risk.

On top of that, nearly half of Indiana’s exports are destined for customers in Canada and Mexico, generating more than $16 billion in export revenue. Indiana’s farmers and ranchers would also suffer a blow, particularly those with soybean crops exported to Mexico.

Donnelly Co-Sponsor of Chamber Policy Priority – Delaying Health Insurance Tax

Great news on a long-term policy priority for the Indiana Chamber! A bill has been introduced to delay the implementation of the Affordable Care Act’s Health Insurance Tax (HIT) until 2020 and to make the fees tax-deductible. As things currently stand, the tax would come into effect in early 2018 and bring with it increased health care costs.

Joe Donnelly

Senator Joe Donnelly is one of two co-sponsors of the measure from Sen. Heidi Heitkamp (D-ND).

The Indiana Chamber opposes HIT because of its impact on the small business community. HIT rests entirely on the insured marketplace, so that means businesses and their workers will feel the brunt. Higher premiums for consumers, including small and family-owned businesses – no thanks! And to make matters worse, the tax does not sunset but increases through 2024 and is adjusted for premium growth.

A recent report funded by UnitedHealth Group says that HIT would “increase 2018 health care costs by $158 per person on the individual market, and by $245 for Medicare Advantage participants.”

The HIT has been a bipartisan bone of contention for years, with a previous one-year delay in implementation already having passed Congress.

The Heitkamp-Donnelly bill, S. 1978, now will be reviewed by the Senate Finance Committee.

The Indiana Chamber will continue to voice its approval for this measure to our delegation members.

New Senate Health Care Bill An Improvement for Employers

The U.S. Senate appears to be gearing up for another health care vote, with a measure from Sens. Bill Cassidy (R-LA) and Lindsey Graham (R-SC) headed to the floor as soon as the middle of next week.

At its core, the Graham-Cassidy proposal creates a block grant program, taking much of the funding provided in the Affordable Care Act (ACA) and sending it to the states for them to set up their own health care systems and determine where to direct the funds.

It also does away with several pillars of the ACA, including the mandate for individuals to have insurance or pay a penalty. The true ramifications of that are uncertain, but could mean higher premiums for those in the health care exchanges (aka those who don’t have insurance through their workplace).

From the standpoint of employers, the Indiana Chamber believes Graham-Cassidy is an improvement over the ACA. This is primarily due to two changes:

  1. The removal of the employer mandate to offer coverage. If that goes away, so too does the ACA’s definition of a full-time employee as someone working an average of 30 hours per week; this has negatively impacted businesses and workers – many of whom saw their hours reduced.
  1. The permanent elimination of the medical device tax, which is detrimental to vital Hoosier employers like Cook Medical in Bloomington, Zimmer Biomet in Warsaw and many others.

Overall, those in favor of increased state control are more receptive to the Graham-Cassidy effort.

As Vice President Mike Pence put it on Fox News yesterday: “…The question that people ought to ask is, who do you think will be more responsive to the health care needs in your community? Your Governor and your state legislator, or a congressman and a President far off in the nation’s capital?…”

 What has opponents worked up is two-fold: affordable coverage for pre-existing conditions isn’t specifically guaranteed; and population size will determine the amount of the block grant, which will reduce funding for a number of states – including some in the Rust Belt and more rural states in general.

Republican Sen. Jeff Flake of Arizona told MSNBC on Thursday he has absolute faith that governors will keep pre-existing condition protections, because of the severe political cost if they don’t. Opponents are less convinced.

At this point, Kentucky Sen. Rand Paul is the lone Republican who has sworn opposition to the Graham-Cassidy bill publicly – in part because his state appears to be set to lose funds in this model.

Likewise, Indiana is expected to see less federal dollars, but the Hoosier state has been preparing for what it saw as an eventuality for several years – setting aside hundreds of millions of dollars to subsidize its Healthy Indiana Plan (HIP) 2.0.

The HIP model is unique in the country; it requires participants to have “skin in the game” with their health care decisions and allows for capping the number of participants. Both of these make it an inherently more nimble program. And ultimately, the state Legislature can also determine to put more funds into HIP 2.0, if it’s deemed necessary.

These facts and the lure of more state control were likely factors in Gov. Eric Holcomb’s decision to sign a letter supporting Graham-Cassidy; he was one of 15 state executives to do so. The reality is other states may not be as fiscally prepared for a possible funding reduction as Indiana is.

That leads us to who may end up being the pivotal figure in the floor vote: Sen. Lisa Murkowski of Alaska. She joined Sen. Susan Collins (Maine) and Sen. John McCain (Arizona) in voting no on the last health care reform measure. Collins is seen as a likely “no” again, joining Paul, while McCain is a predicted (or at least hoped for) “yes.”

As a result, the bill authors are pulling out all the stops and making special accommodations for Alaska in the bill to woo Murkowski’s vote – because they can’t lose her and have the bill survive for Vice President Pence to break the tie. If no specific provisions for Alaska are made, the state would be a big loser in the bill in funding because of its size vs. population and geography.

The Indiana Chamber plans to talk about health care reform with Sen. Joe Donnelly, who has announced his opposition to Graham-Cassidy, and Republican Sen. Todd Young during Wednesday’s D.C. Fly-in event.

UPDATE: This afternoon, McCain announced he would oppose the Graham-Cassidy bill, making passage of the bill seemingly very difficult.

Donnelly, Walorski Working to Define Full-Time as 40 Hours Per Week

Since the passage of the Affordable Care Act (ACA), employers in Indiana and across the country have been forced to cut employees’ hours due to the law’s definition of a full-time employee as someone working an average of 30 hours per week.

The Indiana Chamber recognizes this as a significant issue for the Hoosier business community and has been pushing for a change back to the 40-hour work week. We are pleased to see that our delegation is leading efforts to make that happen.

Recently, Sen. Joe Donnelly reintroduced a bipartisan proposal that would change the definition of a full-time employee under the ACA to someone who works an average of 40 hours per week. Donnelly partnered with Sen. Susan Collins (R-ME) on this legislation.

Senator Joe Donnelly and Congresswoman Jackie Walorski greet Vice President Mike Pence as he arrives in South Bend to deliver the May commencement address at the University of Notre Dame (photo courtesy WSBT).

“I believe that we can work together to fix issues with the health care law and improve our health care system. I have heard from part-time workers across many industries, like school cafeteria managers to grocery store employees to adjunct professors at colleges, that have seen their hours cut to comply with the health care law,” Donnelly said.

“In Indiana, common sense holds that a full-time employee is someone who works an average of 40 hours a week, and the health care law should reflect that. I’m proud to partner with my friend and colleague Sen. Collins to reintroduce the Forty Hours is Full Time Act, and I am hopeful the Senate will consider this bipartisan bill soon.”

Meanwhile, a similar effort was introduced Thursday in the House led by Republican Congresswoman Jackie Walorksi (IN-02) and Congressman Dan Lipinski (D-IL).

The Save American Workers Act (H.R. 3798) also would restore the traditional 40-hour work week under the ACA.

“Obamacare’s burdensome employer mandate and its redefinition of full-time workers are hurting middle class American families and crushing our job creators,” Walorski said. “The Save American Workers Act will provide much-needed relief to hardworking Hoosiers who have faced reduced hours and fewer jobs. This bipartisan, commonsense bill will give businesses the certainty they need to create jobs, and it will give workers the opportunities they need to succeed.”

Background
The ACA currently requires employers with more than 50 full-time equivalent workers to offer health insurance to full-time employees (working 30 hours weekly) or face a penalty. This requirement has forced businesses to reduce hours and slow hiring in order to avoid unaffordable new costs or the ACA’s substantial fines. The 30-hour definition has affected workers in the private sector as well as city, state and school employees, with a particularly severe impact on hourly, part-time, and seasonal workers.

New Training Grants for Employers Now Available

The Indiana Chamber has been strongly encouraging our state government leaders to take bold action to address Indiana’s current and future workforce needs – a significant concern for many of our members.

We’re pleased to see Gov. Holcomb’s recent rollout of the Next Level Jobs initiative, which will help to further ensure employees have the skills needed to compete in the 21st century workforce.

What does this mean for your business?

Employer Training Grants are available! Employers in high-demand business sectors can be reimbursed up to $2,500 for each new employee that is trained, hired and retained for six months.

• Your employees can also take advantage of Workforce Ready Grants and access free education opportunities to help sharpen their skill set for the changing workforce.

Let us know if you need assistance in navigating these opportunities.

Education Interim Study Committee and Graduation Pathways Panel Get Going

The Education Interim Study Committee will have three meetings this year on the following dates and subjects:

• August 30 – Eligibility of an undocumented student brought to the United States as a minor (aka, “Dreamer”) to pay the resident tuition rate that is determined by a state educational institution
• September 28 –  New teacher induction programs
• October 25 – Federal Every Student Succeeds Act

The Indiana Chamber will be covering these hearings and will report pertinent information to our membership.

Separately, the Graduation Pathways Panel has already completed two of its eight meetings scheduled before November 1, 2017. As background, the panel was developed as a part of House Bill 1003, which created the new statewide assessment platform to replace ISTEP, now called ILEARN. In addition to installing a new test, the law introduces the idea of pathways for graduation, or other opportunities for students to graduate besides passage of an end-of-course assessment. The law suggests that pathways MAY include options like passing the SAT/ACT or ASVAB (Armed Services Vocational Aptitude Battery); earning an industry certification; earning AP, dual credit or International Baccalaureate credits; or any other pathway as determined by the panel.

The Chamber’s Caryl Auslander, vice president of education and workforce, was appointed to the task force to provide a voice for Hoosier employers and to underscore that employers have a direct stake in the skills that Indiana students may graduate with.

The first meeting set goals and standards for the panel, and the discussion centered around these questions: How do we establish graduation pathways rigorous enough to create an educated and talented workforce and how can we best align this with what our business and higher education communities need?

The second meeting, which took place this week, featured students and collaborators as invited guests and attempted to answer the following questions:

• How do we establish graduation pathways that allow every student to find success after high school?
• How do you define “success?”
• What are some gaps/deficiencies students experience in their preparation for college and careers? And how would you address those?
• What do you think meaningful and valuable pathways are? What is the best way high schools can set students up to be successful in higher education or business?

Making recommendations for pathways will be a difficult process, but we are grateful that the employer community can be represented on the panel. We will reiterate to other stakeholders the importance of having rigorous pathways that provide currency for the students post-graduation so that they can achieve further education, or meet skills gaps in the workforce. We look forward to further meetings and collaboration over the next few weeks.

National Emergency Declared for Opioid Crisis; Donnelly and Walorski Applaud President’s Action

Building upon the recommendations in the interim report from the President’s Commission on Combating Drug Addiction and the Opioid Crisis, President Trump recently instructed his administration “to use all appropriate emergency and other authorities to respond to the crisis caused by the opioid epidemic.”

Both Sen. Joe Donnelly and Congresswoman Jackie Walorski (IN-02) issued statements supporting the decision:

“I am pleased that President Trump plans to declare the opioid epidemic a national emergency. We know that it will take all of us working together to effectively turn the tide against this public health crisis that has harmed so many families in Indiana and across the country,” Donnelly said. “I hope this declaration will lead to necessary, additional resources for states and local communities to ensure those battling substance use disorders can access treatment.”

Walorski stated: “Opioid abuse is having a devastating impact on our communities, and President Trump’s declaration of a national emergency treats this epidemic with the urgency it requires. I will continue working with my colleagues and the administration to make sure first responders, law enforcement, medical professionals, treatment providers and families in our communities have the tools and resources needed to solve this crisis.”

Congress last year passed into law the Comprehensive Addiction and Recovery Act (CARA), bipartisan legislation to address the nationwide opioid epidemic.

Congresswoman Walorski served on the conference committee that negotiated the final bill, which included two provisions she authored. One requires the Department of Veterans Affairs (VA) to participate in state prescription drug monitoring programs, and the other allows the VA to use FDA-approved medical devices and other non-opioid therapies to treat chronic pain. Donnelly also helped enact CARA, which included several of his provisions. Additionally, Donnelly helped pass the 21st Century Cures Act into law, which includes a $10.9 million federal grant that will support prevention, treatment and recovery services in Indiana.

More recently, in late July, Donnelly introduced a bipartisan package of legislation “aimed at providing the facilities and access to telemedicine needed “to prevent and treat substance use disorder in rural communities.”

Republican Field Grows for U.S. Senate; Reminder of Chamber Endorsement Process

It’s been a busy week for Republicans wanting to challenge Sen. Joe Donnelly for his seat. The number now stands at six.

On Wednesday, Congressman Todd Rokita (IN-04) officially announced his intentions while on the steps of the Indiana Statehouse – it marked the first stop in his nine-city tour sharing the news.

“Hoosiers want a commonsense senator willing to take on tough fights. Hoosiers want a conservative senator who shares our values and works with President Trump and Vice President Pence to turn the country around,” Rokita said. “Hoosiers want a senator who votes the interests of Hoosiers, not the Washington elite. We don’t have that in Joe Donnelly, and too much is at stake to accept it. That’s why I am announcing my candidacy for the United States Senate.”

Rokita’s campaign slogan promises to “Defeat the Elite” in Washington.

Meanwhile, Congressman Luke Messer (IN-06) will formally announces his bid Saturday at the 6th Annual Messer Family BBQ in Morristown.

Senator David Long, President Pro Tempore of the Indiana State Senate, has already thrown his support behind Messer:

“As a young and talented member of the Indiana House, Luke proved his conservative credentials early on by helping us create a new vision for Indiana in partnership with Gov. Mitch Daniels. As a strong and innovative leader for educational choice, Luke fought to ensure Hoosier families and children have the options they need to obtain a world-class education. As a quickly-rising star in Congress, Luke has proven he can work with difficult coalitions of interests to move an agenda for the American people.

“While the Republican Party is blessed to have a number of candidates interested in the seat, I believe Luke to be the absolute best person to effectively represent the interests of all Hoosiers in the U.S. Senate.”

State Representative Mike Braun of Jasper officially entered the race on Thursday. He previously cited the public sparring of Messer and Rokita as well as his business experience as reasons for his decision.

Meanwhile, Indiana Attorney General Curtis Hill made it clear on Wednesday that he hasn’t ruled out joining the GOP primary.

Other Republicans already in the field are Hamilton County businessman Terry Henderson, Kokomo attorney Mark Hurt and Floyds Knobs educator Andrew Takami.

In terms of any congressional endorsement the Indiana Chamber may provide, the matter is taken up by our federal political action committee (PAC). Bill authoring and voting history on pro-jobs, pro-economy legislation and in-person interviews of the candidates will play large roles in the decision making.

The PAC’s work won’t begin until after the candidate filing deadline early next year – as it’s possible a candidate may decide not to run, while there also could be someone else elect to throw their hat into the ring. But when the time comes, you can be assured that a thorough vetting process will take place before a determination is made to endorse a candidate (or no candidates).