10.26.17

Gardner Speaks on Senate Floor About Need to Delay Health Insurance Tax

Washington, D.C.– Senator Cory Gardner (R-CO) spoke yesterday on the Senate floor about legislation he introduced, the Healthcare Tax Relief Act, that would delay the Health Insurance Tax created by the Affordable Care Act. 

Click here to view the full remarks.

 

Remarks as Prepared for Delivery:

 

Mr. President, I rise today to discuss the Healthcare Tax Relief Act, legislation I have introduced to delay the Health Insurance Tax created by the Affordable Care Act.

 

This tax, often referred to as the HIT, imposes fees on health insurance coverage to consumers.

 

Pretty simple—business gets fee, fee gets passed on!

 

As is the case with most excise taxes, if this tax takes effect, costs will be passed to consumers in the form of higher premiums as confirmed by the Congressional Budget Office.

 

One of the cost drivers built into the ACA, this tax was set to begin in 2014 starting at $8 billion and reach $14.3 billion by 2018; however, Congress suspended the tax from taking effect in 2017.

 

Without congressional action, this tax will take effect in 2018.

 

According to non-partisan actuarial analysis conducted by Oliver Wyman, an estimated 157 million Americans stand to be effected by this tax.

 

Even more, middle-income earners and working American’s are expected to shoulder the weight of this tax as well.

 

Oliver Wyman, estimated that premiums will rise by 3 percent in each 2018, 2019 and 2020. 

 

That’s nine percent over three years.

 

To put this in perspective, in Colorado alone, premiums in the individual market rose by 34.3 percent from plan year 2017 to 2018.

 

Adding 3 percent every year for three years to this equation would leave those on the individual market paying nearly a 43.3 percent increase if combined with 2018 increases.

 

What’s more, according to the Department of Health and Human Services, average individual market premiums have increased by 105 percent from 2013 to 2017. 

 

Without congressional action, estimates show costs will rise between $200 and $300 dollars annually for individuals and $500 dollars annually for families.

 

For those living pay-check-to-paycheck, these costs could push them into financial crisis. 

 

Recent data from the Federal Reserve found that 46 percent of Americans did not have enough money to cover a $400 dollar emergency expense.

 

This tax has the potential to push over half of Americans into financial ruin and it would be negligent for Congress to allow this tax to take effect.

 

The financial threat this tax imposes on hard working families is a far cry from President Obama’s promise that health care premiums would fall by $2,500 per family.

 

At a time when we know that almost half of Americans could not shoulder a $400 dollar emergency expense, it would be irresponsible to allow this tax to take effect.

 

Furthermore, the impacts of this tax touch our seniors who have earned their benefits as well.

 

For seniors enrolled in Medicare Advantage plans, premiums are expected to rise by roughly $370 a year per enrollee if congress does not find a resolution.

 

In addition, seniors enrolled in Medicare Part D prescription drug plans can expect their premiums to rise as well.

 

Even more, the impacts of the Health Insurance Tax have large-scale consequences in the workplace as well.

 

A study by the National Federation of Independent Businesses found that allowing the HIT to take effect could result in a reduction of as many as 286,000 jobs by 2023.

 

Research and analysis from our most respected actuaries continues to validate the negative consequences of the Health Insurance Tax.

 

On behalf of all hard working Americans, I call upon my colleagues to join me in cosponsoring this common sense piece of legislation, the Healthcare Tax Relief Act.

 

Health plans are finalizing their rates for plan year 2018 and it is urgent for congress to take action so that consumers are not saddled with the burden of this onerous tax.

 

Mr. President, I yield the floor.

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Cory Gardner is a member of the U.S. Senate serving Colorado. He sits on the Energy & Natural Resources Committee, the Foreign Relations Committee, the Commerce, Science, & Transportation Committee, and the Budget Committee, and is the Chairman of the Subcommittee on East Asia, the Pacific, and International Cybersecurity Policy and Subcommittee on Energy.

354 Russell Senate Office Building, Washington, DC 20515

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