While the GOP’s efforts to repeal and replace the Affordable Care Act are facing increasing headwinds, there are still a number of ACA provisions that might be tweaked in other measures. And the Cadillac tax is most likely to be on tap first.
Eliminating the Cadillac tax “will likely receive considerable attention,” says Chatrane Birbal, senior advisor for government relations at the Society for Human Resource Management. She notes that standalone bipartisan legislation has already been introduced to repeal the 40 percent excise tax on high cost employer-sponsored health coverage in the form of the “Middle Class Health Benefits Tax Repeal Act of 2017,” sponsored by Senators Mike Kelly (R-Pa.) and Rep. Joe Courtney (D-Conn.).
Unions and employer advocacy groups are supporting the measure. In January, the ERISA Industry Committee, a national association that advocates for large employers on health, retirement and compensation public policies, lobbied for Congress to “quickly to pass it,” even before the GOP repeal and replacement effort was introduced.
“Employers work hard to design benefits that keeps costs under control,” says James Gelfand, the group’s senior vice president for health policy. “Taxing those benefits would only lead to fewer employers offering health benefits and worse options for employees. Changes to the health care system should seek to build on the success of the employer-sponsored system, not punish the part of the system that truly works.”
However, a big hurdle is “replacing the lost $90 billion in revenue that the Congressional Budget Office expects the Cadillac tax would bring in over a 10-year budget window,” Brian Gilmore, lead benefits counsel for ABD Insurance and Financial Services tells SHRM. "The wrong way to address the lost revenue would be to cap the tax exclusion for employers’ health care costs.”
Meanwhile, health insurance lobby, America's Health Insurance Plans, in a letter this week asked Senate Finance Chairman Orrin Hatch (R-UT) to repeal the Cadillac tax, as well as the health insurance tax (HIT) as part of the committee’s tax overhaul efforts, according to Inside Health Policy.
Other ACA provisions that might be revisited in stand-alone legislation down the road, according to SHRM, include repealing the employer mandate, amending the definition of full-time and seasonal employees entitled to receive health coverage from large employees, and easing employee tracking and IRS reporting requirements for employers offering health coverage to their employees.
Complete your profile to continue reading and get FREE access to BenefitsPRO, part of your ALM digital membership.
Your access to unlimited BenefitsPRO content isn’t changing.
Once you are an ALM digital member, you’ll receive:
- Breaking benefits news and analysis, on-site and via our newsletters and custom alerts
- Educational webcasts, white papers, and ebooks from industry thought leaders
- Critical converage of the property casualty insurance and financial advisory markets on our other ALM sites, PropertyCasualty360 and ThinkAdvisor
Already have an account? Sign In Now
© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
Katie Kuehner-Hebert
Katie Kuehner-Hebert is a freelance writer based in Running Springs, Calif. She has more than three decades of journalism experience, with particular expertise in employee benefits and other human resource topics.
