Congress Considering Suspending ACA’s ‘Premium Tax’ for One Year
Federal lawmakers are weighing whether to include a one-year suspension of the Affordable Care Act's health insurance tax to a tax-extenders bill that Congress must pass by the end of this year, The Hill reports (Sullivan , The Hill, 12/10).
Republican lawmakers are pushing for approval of a permanent tax-extender measure by the end of the year. However, Congress could consider a measure that would extend certain taxes for two years (Ota, CQ News, 12/8). Currently, the short-term measure is expected to include a two-year delay of the ACA's medical device and so-called "Cadillac" taxes.
Premium Tax Debate
According to The Hill, lawmakers are considering whether to suspend the so-called "premium tax" for one year in 2018.
Republicans have long supported repealing the tax, while some Democrats have also backed the tax's repeal. A House bill (HR 928) that would eliminate the tax currently has support from 228 Republicans and seven Democrats, according to The Hill.
Health insurance companies have also supported repealing the tax, which they say is passed on to consumers through premium increases.
The federal government has estimated that the tax will generate $100 billion in revenue over 10 years.
Uncertainty Over Tax-Package Remains
According to The Hill, it is not yet clear whether negotiators will proceed with the package that includes two-year delays on the Cadillac and medical device taxes or if they will reach a broader deal that includes ACA-related measures (Sullivan , The Hill, 12/10).
While most ACA supporters say they also support the short-term tax delays, some Democratic lawmakers have expressed concern that the delays would help boost opponents' future efforts to scale back the law. Sen. Mark Warner (D-Va.) said, "A two-year delay, I'm concerned, turns into a permanent delay."
Further, health policy experts, President Obama and other Democratic lawmakers say the Cadillac tax would generate revenue and curb health care costs.
However, Sen. Chris Murphy (D-Conn.), who supports the ACA but opposes the Cadillac tax noted, "The law clearly is costing less than imagined, so we have a surplus of revenue compared to how much the law costs" (Sullivan , The Hill, 12/10).This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.