Bipartisan legislation, S. 172, was introduced last week that would extend the current moratorium of the ACA’s Health Insurance Tax, also known as the HIT, through December 2021. The legislation was led by Senators Cory Gardner (R-CO), Jeanne Shaheen (D-NH), Doug Jones (D-AL), John Barrasso (R-WY), Kyrsten Sinema (D-AZ) and Tim Scott (R-SC). The tax is currently suspended for calendar year 2019. NAHU, along with the Stop the HIT Coalition, has long advocated for permanent repeal of this tax or short of a full repeal, to temporarily suspend the tax until a more comprehensive solution can be implemented.The HIT, dubbed a fee, assesses a tax on all health insurance companies of insured plans both inside and outside the exchange based on their “net premiums” written. While it is charged to insurers to help pay for the ACA, it is ultimately passed down in the form of increased premiums for small businesses, middle-income families, seniors and young workers, with more than half of the tax paid for by those earning between $10,000 and $50,000. Over a 10-year period, this tax is projected to increase premiums for single coverage by an average of $2,150 and family coverage by an average of $5,080.
The legislation follows the introduction of a similar bill earlier this month by Senators Barrasso and Sinema to fully repeal the tax. The additional two-year moratorium is intended as a short-term stopgap measure to provide additional time for lawmakers to consider more comprehensive solutions, including the full repeal of the tax. NAHU has been a leading advocate for the recent moratoriums enacted into law that have temporarily suspended the tax and provided short-term relief for Americans affected by the tax.