September 5, 2017
By Brett Healy
MacIver Institute President
The following op-ed first appeared in the Green Bay Press-Gazette on Saturday, Sept. 2.
As we all wait to see how the debate over health care reform and the fate of Obamacare will be resolved, there is a relatively simple step Congress can take to control health care costs.
While action to repeal a tax on health insurance premiums is not the full-scale health care reform Congress has been working toward, it is a step in the right direction to contain health care costs.
The tax is scheduled to take effect in January and is a component of the Affordable Care Act. It will result in employers paying $210 more per employee and families paying $530 more per year on average, according to a study by global consulting firm Oliver Wyman.
Thankfully, the tax was suspended in 2017 with bipartisan support and members of both sides of the aisle are beginning to line up in support of either suspending or repealing the tax outright in 2018. Congress needs to act soon.
Nearly 50 percent of the tax falls on Americans earning between $10,000 and $50,000 a year. Self-employed workers will bear 60 percent of the tax burden, and approximately 25 percent of it falls on Medicare Advantage and Part D plans.
In Wisconsin, if the Health Insurance Tax survives:
- Medicare Advantage recipients will see their premiums increase $237 for individual policies or $474 per couple in 2018;
- Fully insured small business owners and their employees will experience a $552 increase in premiums for family coverage and a $192 increase for individual coverage;
- Fully insured large employers and their employees will see a $553 increase in premiums for family coverage and a $189 increase for individual coverage;
- State Medicaid programs will incur an additional cost of $175 for each of their insured Medicaid enrollees in 2018; and
- BadgerCare Plus will incur an additional cost of $34 million to the state.
If Congress fails to repeal the tax on time, the average American family can expect to see their health insurance policy premium rise by more than $5,000 over the course of a decade.
Overall, the HIT will force more than 100 million Americans nationwide to pay $22 billion more for their health insurance, whether you receive your insurance through Medicare, Medicaid or your employer.
Time is running out. Health insurance premiums for 2018 will be finalized soon and Congress needs to act in the next few weeks.
Last year, nearly 400 Republicans and Democrats voted to suspend the tax. Let's hope that Republicans and Democrats can come together again to take this simple and direct step to control health care costs for millions of Americans.
Read the original op-ed in the Green Bay Press-Gazette here.