The Senate’s Parliamentarian ruled Monday night that funding to shore up failing union pension plans and to subsidize health insurance for jobless workers do not violate the “Byrd rule,” which limits what can be considered under budget reconciliation procedures. The rule requires provisions to have a direct budgetary impact, and the deficit impact cannot be considered “merely incidental” to what is a broader policy change. The pension measure, which would cost about $82 billion over a decade, would provide a financial lifeline to multiemployer pension plans that risk insolvency.
The Congressional Budget Office (CBO) said the new “special financial assistance” program would benefit on average about 185 pension plans, enabling them to pay full benefits for about three decades. The second provision would provide subsidies to make health insurance more affordable under COBRA, which offers continuing employer-sponsored coverage after workers leave their jobs. Per the CBO, the measure would fund 85 percent of workers’ premiums through September at a net cost of about $7.8 billion over a decade and estimated that 2.2 million individuals would obtain COBRA coverage as a result, on a full-year equivalent basis, with 600,000 of those likely to have been uninsured otherwise.
Stay tuned for future Legislative Updates with more updates on the COVID-19 stimulus package.