U.S. Rep. Mike Kelly (R-PA) on Wednesday continued his leadership on junking the so-called “Cadillac Tax” on high-cost health plans, a move that will help Americans at all health plan levels avoid reductions in benefits.
The 40 percent excise tax on certain high-cost employer-sponsored health plans, which starts in 2020, would add to the burden faced by everyday working Americans trying to afford health care for themselves and their families, Kelly pointed out in a bipartisan letter to House Speaker Paul Ryan (R-WI) and House Minority Leader Nancy Pelosi (D-CA).
Rep. Joe Courtney (D-CT) joined Kelly in spearheading the letter signed by 140 bipartisan members of the House.
Kelly and Courtney stressed that the tax under the Affordable Care Act affects many more people than simply those who are insured by high-cost plans.
“While some claim that this tax was intended to hit only the most generous ‘Cadillac’ plans, that notion is mistaken since millions of hardworking Americans and their families face a significant reduction of their benefits with an increase in their cost-sharing as a result of this tax,” the letter said. “In reality, the tax unfairly and disproportionately affects middle-income Americans, women, and their families. Moreover, older workers and small businesses would also be heavily impacted.”
The letter pointed out that many employers might reduce their employee health care coverage because of the burdensome tax.
“While Congress has already delayed implementation of this excise tax until 2020, the policy is already having an impact,” the letter said. “Large employers and labor unions are currently negotiating benefits packages that stretch into 2020, with many employers reporting that they are considering reducing the value of their health benefits to avoid this excise tax. We cannot wait to repeal it.”
Kelly and Courtney in January introduced H.R. 173, the Middle Class Health Benefits Tax Repeal Act of 2017, which has 214 cosponsors in the House.
“Relief is needed now on the health benefits tax,” said AFL-CIO President Richard Trumka. “Working people are paying more and more for their health care because this tax drives up deductibles and copays. Repeal of this tax is overdue.”
“We are thankful for all the members of Congress working to address the ‘Cadillac Tax’ before the end of the year,” said James A. Klein, president of American Benefits Council, for the Alliance to Fight the 40. “The clock is ticking and the ‘Cadillac Tax’ is already driving up costs for the 178 million Americans who receive their health care coverage through their employer.”