House Passes ‘Cadillac’ Tax Repeal

On Wednesday, the full U.S. House of Representatives passed H.R. 748, the “Middle Class Health Benefits Tax Repeal Act,” in an overwhelmingly bipartisan vote, 419-6. The legislation, introduced by Reps. Joe Courtney (D-Connecticut) and Mike Kelly (R-Pennsylvania), would fully repeal the “Cadillac” tax.

The “Cadillac” tax is a 40% excise tax on employer-sponsored health insurance plans that exceed a certain cost threshold which was signed into law as part of the Affordable Care Act (ACA). The “Cadillac” tax has already been delayed twice and is currently set to take effect in 2022.

Although the “Cadillac” tax was ostensibly intended to target only high-value plans, more modest plans are also projected to trigger the tax because it is tied to a slow level of inflation. The tax unfairly and disproportionately affects middle-income Americans, women, seniors and working families. It would also heavily penalize small businesses by potentially forcing them to choose between paying the tax or reducing benefits for their employees.

The Big “I” strongly supports repealing this onerous tax and has worked hand in hand with the Alliance to Fight the 40, a broad-based coalition comprised of businesses, patient advocates, employer organizations, unions, local governments, health care companies, consumer groups and other stakeholders to advocate for the repeal of the tax. Earlier this week, the Alliance to Fight the 40, sent a letter to House and U.S. Senate leadership urging Congress to repeal this tax.

The Big “I” will continue to advocate for the Senate to pass this legislation.

Wyatt Stewart is Big “I” senior director of federal government affairs.