Unless Congress further delays the Health Insurance Tax, more than 142 million Americans will face a $20.3 billion tax hike on Jan. 1, 2020, according to new actuarial analysis from Oliver Wyman. The HIT has increased health insurance costs by imposing a levy on the net premiums of health insurance companies, which is passed on to consumers.
During 2014, $8 billion in excise taxes were levied, and $11 billion were collected in 2015 and 2016 each. The tax is on hold through 2019 but since the cost of the HIT increases each year, Americans will face an even higher HIT impact in 2020.
If Congress extends HIT relief for another year, individual and small business owners would see more than $150 in savings, according to the Oliver Wyman analysis. Families purchasing coverage in the small group market would save nearly $500, while seniors enrolled in Medicare Advantage would save roughly $250.
This much-needed savings is likely driving the growing support for suspending the HIT. A recent national poll from Morning Consult indicates an overwhelming majority of surveyed voters (73 percent) are in favor of repealing or suspending the HIT.
Earlier this summer, the House passed a bill (H.R. 6311) that contains a Farm Bureau-supported two-year delay of the HIT. In addition, Farm Bureau supports H.R. 246, which would repeal the HIT.