07/18/2019

House Passes Legislation to Repeal Cadillac Tax

The vote passed 419-6

On July 18, 2019, the U.S. House of Representatives easily passed legislation to repeal the “Cadillac tax” on high-cost employer-provided health insurance that was supposed to help pay for the Affordable Care Act (ACA).  The 419-6 vote confirms that the Cadillac tax is deeply unpopular with both Republicans and Democrats despite having never taken effect.

Delayed repeatedly by Congress, the tax would impose a 40 percent excise tax beginning in 2022 on employer-provided health plans that exceed $11,200 for an individual and $30,100 for a family. The goal of the tax initially was to keep healthcare costs down and help pay for the ACA, but even congressional Democrats now say that the tax would primarily hurt working families that have health coverage through their jobs.

“Today, we’ll honor our promise to the hard-working men and women of the labor as we lift the Cadillac tax, protecting health benefits that workers have negotiated,” Pelosi said yesterday.

Repealing the tax will add to the growing national deficit. The nonpartisan Congressional Budget Office estimated repeal of the tax would add $197 billion to the deficit over 10 years.

The Senate has a similar bill with bipartisan support but Senate Majority Leader Mitch McConnell (R-KY) has not indicated whether he will bring it up for a vote.

This article was provided to OSAE by the Power of A and ASAE's Inroads.