In January 2017, Senators Dean Heller (R-NV) and Martin Heinrich (D-NM) introduced S. 58, and Representatives Mike Kelly (R-PA) and Joe Courtney (D-CT) introduced H.R. 173, legislation to repeal the ACA’s Cadillac/Excise Tax, which will impose a 40% excise tax on health plans that exceed certain cost thresholds beginning in 2020.
The Cadillac Tax calls for a 40% excise tax on the amount of the aggregate monthly premium of each primary insured individual that exceeds the year’s applicable dollar limit, which will be adjusted annually to the Consumer Price Index plus 1% initially and then CPI. Given that the pace of medical inflation is well beyond that of general inflation, the tax is destined to outgrow itself in short order and many employers will be impacted by the cost of the tax and the enormous compliance burden that the tax creates. Mercer estimated that a third of employers will be subjected to the tax when it’s set to kick in and that 60% of employers will be hit by 2022. Because of the projected wide reaching effect of the tax, many employers may be deterred from offering coverage.
Take Action today and tell your federal legislators to pass a repeal of the Cadillac/Excise Tax!