A bipartisan group of senators introduced legislation on Friday that would delay Obamacare’s health insurance tax, which experts say could increase premiums by hundreds of dollars per person.
A bipartisan group of senators introduced S. 172, the Health Insurance Tax Relief Act this week to delay the Affordable Care Act’s (ACA) Health Insurance Tax (HIT) by two years.
Sens. Cory Gardner (R-CO), Jeanne Shaheen (D-NH), John Barrasso (R-WY), Doug Jones (D-AL), Tim Scott (R-SC), and Krysten Sinema (D-AZ), all sponsored the legislation.
The HIT acts as a fee on health insurers on their health policy premiums, which studies have shown increases the cost on nearly every American with a health insurance policy. If Congress fails to act, the HIT tax will impact Americans in 2020.
“American families need relief from the health insurance tax,” said Senator Barrasso in a statement Friday. “This needless Obamacare tax drives up premiums and makes it harder for patients to get the care they need. In the coming months, I look forward to supporting efforts to eliminate this harmful tax.”
According to America’s Health Insurance Plans (AHIP), if implemented in 2020, the HIT would levy $16 billion in fees on health insurance. If Congress fails to act, the HIT will increase premiums by 2.2 percent or $196 per person on the individual market, $479 per family in the small-group market, $458 in the large-group market, and $157 for Medicaid premiums nationwide.
In 2018, for the first time in Obamacare’s history, the Donald Trump administration managed to lower premiums by 1.5 percent. Failing to delay the HIT would increase health insurance premiums and stall the the Trump administration efforts to make health insurance more affordable for all Americans.
Oliver Wyman, a global consulting firm, released a study this week which found that had Congress not delayed the HIT in 2019, the national average premium for Medicare Advantage enrollees would have increased by 55.7 percent.
Sen Scott said:
We need to do everything we can to ensure that every American has access to quality and affordable health care. If the health care insurance tax is not addressed quickly, we could see a dramatic increase in the price of health care in South Carolina and around the country. I am proud to stand with a bipartisan coalition of Senators in protecting both the health and wallets of every day Americans, small business owners, and seniors covered through Medicare Advantage.
“This tax raises costs for Arizona families and businesses,” said Sen. Sinema. “I’m proud to work across party lines to help make healthcare more affordable for Arizonans.”
Karen Kerrigan, the president and CEO of the Small Business & Entrepreneurship Council (SBE Council), released a statement on Friday cheering the senators’ move to delay the HIT.
Extending this relief through 2020 and 2021 means small businesses will be saved from big increases in the cost of coverage that will harm their competitiveness and ability to provide coverage for existing and new employees. In this tight labor market, providing this benefit is essential to recruiting and maintaining the workers small firms need to effectively operate and grow. S. 172 will reinforce small business efforts to compete for workers, and support the growth of the economy in general.
The SBE Council president also noted that a post-election survey of SBE Council members’ number one problem facing their businesses is health care.
“Every Senator needs to sign onto this important bipartisan legislation, which is a common-sense strategy to relieve small businesses of pending price hikes on health coverage,” Kerrigan added.