Government affairs

Legislative Updates

Senate introduces bill to repeal excise tax

Sens. Dean Heller (R-NV) and Martin Heinrich (D-NM) have introduced the Middle Class Health Benefits Tax Repeal Act, to repeal the excise tax on high-cost health insurance plans scheduled to take effect in 2018.

When Congress passed the 2010 Affordable Care Act in 2010, it mandated a 40-percent tax on health insurance expenditures greater than $10,200 per person and $27,500 per family. Scheduled implementation of this excise tax was delayed for five years; it is currently scheduled to take effect in 2018, and it would affect all employer-sponsored health coverage for high-cost benefits.

“This tax will reduce benefits, increase costs of premiums and deductibles, and limit healthcare choices,” Heller said. “That’s why it must be repealed. My hope is that reasonable members of Congress on both sides of the aisle will join us in this important, bipartisan endeavor to protect middle-class Americans.”

“Doing away with this onerous tax on employees’ health coverage before it goes into effect will protect important benefits for workers and ensure businesses and families get a fair deal,” Heinrich said.

The legislation is the companion to H.R. 2050, introduced earlier this year in the House of Representatives by Rep. Joe Courtney (D-CT).

“I’m proud to join Senator Heller and Congressman Courtney in leading this bipartisan effort to ensure millions of middle-class families who rely on employer-based health care aren’t unfairly penalized because of this tax,” Heinrich said.

Actuaries and experts have concluded that the excise tax will unfairly target older workers, women and families in expensive geographic areas—decreasing the quality of their benefits and raising out-of-pocket costs.

The massive, unified response from business, labor, and health care advocates has shown that this issue has a life of its own, and the opposition to this tax will grow louder as more people understand the extent of its impact.

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