With the election of Donald J. Trump as President of the United States, a significant number of changes related to employee benefits are likely to take effect. President Trump made many promises during the campaign but one that was repeatedly brought up was the repeal and replacement of the Affordable Care Act. With majorities in both the House and the Senate, Republicans have enough votes to enact the repeal but they have yet to form a consensus as to what the replacement vehicle should look like. With Democrats likely to oppose any plans to change the current law, expect continued partisan wrangling on this topic.
One additional area of change under the new administration is the implementation of the upcoming Fiduciary Rule by the Department of Labor. During the campaign President Trump mentioned that agencies within Washington were issuing too many regulations and that if elected, he would remove many restrictions. Anthony Scaramucci, the former managing partner of SkyBridge Capital and a member of the Trump Transition Team, has indicated that President Trump intends to repeal the rule but this may not be as easy as it sounds. When the Department of Labor issued the final regulation, which increased the number of people who would be considered fiduciaries when providing investment advice, it delayed the effective date until April 10, 2017. As a result, President Trump cannot just rescind the law; it would take an act of Congress to overturn the Fiduciary Rule, which is unlikely. However, the new administration may delay the implementation of the rule.
Finally, tax reform is expected to come up early in the agenda of the new administration. As part of the final tax reform package, the use of Roth accounts within retirement plans may be promoted or mandated. Since Roth accounts can be used to raise revenue in the short term, they could become a key component of shoring up any potential budgetary deficits.