House Plan to Suspend Obamacare Insurer Tax, But Not For Small Group
House Republican tax writers are considering delaying Obamacare’s health insurance tax for only limited markets next year, leaving out small businesses and possibly private Medicaid plans, according to sources on and off Capitol Hill. They would suspend it for all markets in 2019.
Republicans on the Ways and Means Committee are worried that it will be difficult for the small businesses to send prospective savings from delaying the tax back to consumers. Industry sources, however, say it is possible.
Excluding small business could pose a political problem: Insurance plans covering large companies, individuals in the Obamacare markets and Medicare Advantage plans would see a tax break, but insurers covering small business would not.
The fate of the health insurance tax is being decided in negotiations over a year-end bill. Also in the mix is a two-year delay of Obamacare’s medical device tax, loosening the restrictions on health savings accounts, and delay of the Cadillac tax.
Negotiations are in the early stages, according to several sources, citing the threat of a government shutdown and the conference on the GOP’s tax bill.
“Members are working to deliver as much relief as possible from the health insurance tax — as soon as possible,” a Ways and Means Committee spokesperson said.
On the Senate side, the tax bill has pushed the Obamacare tax delays to the back burner. Senate Finance Chairman Orrin Hatch (R-Utah) said the panel hasn’t considered delay legislation yet.
“But we’ll have to get into it, there’s no question,” he said.