07.25.19

Rounds, Heinrich Urge Swift Senate Action to Permanently Repeal Cadillac Tax

The senators introduced legislation to permanently repeal the Cadillac Tax earlier this year

WASHINGTON—U.S. Sens. Mike Rounds (R-S.D.) and Martin Heinrich (D-N.M.), the bipartisan leads of Senate legislation to permanently repeal the ‘Cadillac Tax,’ today urged Senate leadership to swiftly take up their bipartisan legislation to repeal a provision in the Affordable Care Act (ACA) known as the “Cadillac Tax,” which taxes high-cost health insurance plans and impacts middle-class health benefits.

 

“At a time when health care expenses continue to go up, and Congress remains divided on many issues, the repeal of the Cadillac Tax is something that has true bipartisan support,” wrote the senators. “As leaders in the effort to repeal this onerous tax, we urge you to work with us in finally passing this bill that will benefit hardworking Americans across the country.”

 

Background:

Earlier this year, Rounds and Heinrich introduced the Middle Class Health Benefits Tax Repeal Act of 2019, which would repeal the Cadillac Tax provision of the Affordable Care Act. It has 46 cosponsors in the Senate – 23 Republicans and 23 Democrats. The Cadillac Tax would impact employers and families whose health insurance plans cost more than $11,100 for an individual and $29,750 for family coverage. Implementation of the Cadillac Tax has been delayed numerous times, but if it isn’t repealed, it’s scheduled to take effect in 2022.

 

U.S. Representatives Joe Courtney (D-Conn.) and Mike Kelly (R-Penn.) introduced the Cadillac Tax repeal bill in the House of Representatives, and last week the House voted to pass their legislation. Both the Senate and House bills have bipartisan support.

 

The full text of the letter below:

Dear Leader McConnell and Minority Leader Schumer:

We are writing today in support of the full repeal of the 40 percent excise tax on certain employer sponsored health insurance plans, commonly referred to as the Cadillac Tax. We urge Senate leadership to take up the recently passed House repeal legislation, H.R. 748, the Middle Class Health Benefits Tax Repeal Act of 2019, so that it may be considered by the full Senate.

As you know, the Affordable Care Act’s Cadillac Tax applies to health plans that have a value that exceeds $11,000 for an individual and $29,750 for families. Although the tax will not go into effect until 2022, employers are already restructuring their health care benefits to avoid the tax, which includes reducing benefits and raising out-of-pocket costs. The negative impact this provision is having on American families is unacceptable.

 

There is strong support for repealing the Cadillac Tax on and off Capitol Hill. Between the House and Senate bills, we have gathered over 400 bipartisan cosponsors and more than 600 organizations across the country have voiced support for the repeal of this burdensome tax. We are thrilled that the House passed the Middle Class Health Benefits Tax Repeal Act on July 17, 2019, by an overwhelming vote of 419 to 6 and believe that the Senate should bring up repeal for a vote before the end of this year. At a time when health care expenses continue to go up, and Congress remains divided on many issues, the repeal of the Cadillac Tax is something that has true bipartisan support. As leaders in the effort to repeal this onerous tax, we urge you to work with us in finally passing this bill that will benefit hardworking Americans across the country. Thank you for your consideration of our request.

 

Sincerely,

 

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