Washington – Rep. Joe Courtney scored a win Wednesday after a decade of trying to repeal a tax on expensive health care plans that was imposed by the Affordable Care Act.
The House voted overwhelmingly, 419-6, to approve Courtney’s Middle Class Health Benefits Tax Repeal Act of 2019, which would abolish a tax imposed by the Affordable Care Act.
Commonly known as the “Cadillac tax,” the levy is an excise tax on the most generous and expensive employer health-insurance plans. It was included in the Affordable Care Act as a way to curb health care costs and would raise an estimated $197 billion over 10 years, according to an analysis by the Joint Committee on Taxation.
But Congress kept delaying the implementation of the tax, so its revenues have never been collected or its impact on health care costs assessed.
Those who argued in favor of repealing the tax said it is not just rich corporate executives who are covered under robust health care policies, it’s teachers, state workers and other employees who aren’t necessarily high earners.
“This tax has never generated a penny of revenue, yet it continues to threaten working Americans’ health benefits,” Courtney said. “After over a decade of work towards this effort, the House did the right thing today for families across America by voting to fully repeal the tax.
The nation’s health insurers, who have lobbied long for abolition of the tax, also hailed the House’s action.
“Americans deserve access to high-quality, comprehensive coverage they can afford,” said Matt Eyles, president and CEO of America’s Health Insurance Plans. “Permanently repealing this 40 percent excise tax would help reduce consumer costs through lower deductibles, improve health care access and make health care coverage more affordable for hundreds of millions of hardworking Americans.”
A Kaiser Family Foundation analysis published last week found that, unless employers change their benefit plans, the tax would affect 21 percent of employers that offer health coverage in 2022. Because the tax is indexed for medical inflation, by 2030, 37 percent of employers would be impacted, the Kaiser Family Foundation study said.
Although Courtney’s effort had strong bipartisan support in the U.S. House, and Senate Republicans have shown interest in the bill, it’s not clear whether Senate Majority Leader Mitch McConnell will bring the bill up for a vote.
“Senator McConnell must take a cue from the strong statement made today in the House and bring this bill up for a vote in the Senate,” Courtney said.