Published: Sat, July 20, 2019
Medicine | By Daryl Nelson

House Democratss, GOP unite to repeal Obama health care tax

House Democratss, GOP unite to repeal Obama health care tax

Delayed repeatedly by Congress, the tax would impose a 40 percent excise beginning in 2022 on employer-provided health benefits that exceed $11,200 for an individual and $30,100 for a family. Representative Ron Kind, a Wisconsin Democrat, said he opposes the repeal because the cost isn't offset and there wasn't any discussion about how scuttling the tax would affect the Affordable Care Act overall.

The bill to repeal the levy commonly known as the "Cadillac tax" passed 419-6 with bipartisan support.

The House on Wednesday approved the Middle Class Health Benefits Tax Repeal Act of 2019.

Democrats have generally opposed measures to chip away at President Barack Obama's signature legislative achievement, but the Cadillac tax has been unpopular since it became part of the code.

"Some employers have used the threat of this tax to shift an ever increasing share of healthcare costs to employees".

Steve Wojcik, vice president for public policy at the National Business Group on Health, said the repeal would remove uncertainty for employers planning future insurance coverage for their workers, a process that for large employers often spans two years. "There are also concerns it would unfairly target high-cost health plans that cover people in poorer health or people who live in areas where health costs are high".

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According to the Business Group's most recent survey of large employers, almost three in four respondents (73%) will have at least one plan that triggers the excise tax in 2022 and 94% will in 2026.

While the excise tax was meant to target high-value plans, "modest plans will also be impacted, meaning millions of Americans and their families could face higher co-pays and deductibles, causing some to decline employer-provided health care", Taylor noted. The idea was to reduce soaring health care costs by discouraging employers from offering such generous plans, as well as to pay for the landmark law passed by a Democratic Congress in 2010.

Repeal of the Cadillac tax is estimated to cost $200 billion from 2022 to 2029 and another $1 trillion in the decade after that, according to the Committee for a Responsible Federal Budget, a watchdog group. The tax is created to hit more plans over time so that virtually everyone in an employer-provided plan, including low income workers and families with chronic or catastrophic health conditions, will ultimately be affected. The Alliance seeks to repeal the 40 percent "Cadillac Tax" on health benefits and to prevent increased income taxes on workers, families and retirees who rely on employer-provided health coverage.

The Cadillac tax also has supporters. "We need to start instilling some fiscal discipline in this place and making some tough decisions".

The tax, which Congress twice delayed from taking effect, is set to go into effect in 2022.

What's next: "The Senate has a similar bill with bipartisan support, but Senate Majority Leader Mitch McConnell (R-Ky.) has not yet said whether he will bring it up for a vote", the Post's Yasmeen Abutaleb reported. "There's a certain inevitability to this one getting repealed".

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