AHIP Supports Bipartisan Legislation to Repeal the ACA’s Health Insurance Tax

Washington, D.C. – America’s Health Insurance Plans’ (AHIP) President and CEO Karen Ignagni released the following statement in support of bipartisan legislation co-sponsored by Representatives Charles Boustany (R-LA) and Jim Matheson (D-UT) to repeal the Affordable Care Act’s (ACA) health insurance tax:

“The health care reform law includes a new $100 billion sales tax on health insurance that will drive up costs for consumers and employers.  Unless this tax is repealed, next year an average family will pay over $300 in higher premiums, seniors enrolled in Medicare Advantage will face $220 in reduced benefits and higher out-of-pocket costs, and state Medicaid managed care plans will incur an additional $80 in costs for each person covered.  At a time when many families are struggling due to the weak economy, this tax will mean less money to pay the bills or save for retirement or a child’s education.

“The health insurance tax will add a financial burden on families and small businesses at a time when they can least afford it, and it should be repealed.”

Facts about the Health Insurance Tax:

  • Starting next year the ACA imposes a new $100 billion tax on health insurance.  The tax will start at $8 billion in 2014, increasing to $14.3 billion in 2018, and will continue to increase each year.
  • The health insurance tax is larger than the device tax and the prescription drug tax combined.
  • The health insurance tax will increase costs for individuals and families purchasing coverage on their own, small businesses, seniors and people with disabilities enrolled in a Medicare Advantage plan, and state Medicaid managed care plans.
  • The health insurance tax is far greater than the minimum penalty for those who choose not to buy health insurance – further incentivizing young, healthy people to forgo purchasing insurance until they need medical care.

For more information about the health insurance tax, check out our infographic and web video and visit our website at www.ahip.org/HIT.

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