The column below reflects the views of the author, and these opinions are neither endorsed nor supported by WisOpinion.com.
Wisconsin employers face health insurance premium increases of more than $370 million beginning in 2020 if Congress does not act once again to delay the Health Insurance Tax (HIT) this year.
Introduced as part of the Affordable Care Act (ACA), the HIT is basically a sales tax on health insurance coverage that would hit employers and consumers with higher premiums.
Thanks to bipartisan action by Congress, the HIT was suspended for 2019. But, the one-year moratorium is scheduled to expire and return in 2020, resulting in a new $20.3 billion tax hike, which will mean higher premiums. Oliver Wyman Actuarial Consulting recently analyzed the projected impact of the HIT on health insurer premiums over the next 10 years and found that premiums are likely to increase 2.2 percent in 2020 and in subsequent years if Congress doesn’t delay or repeal the HIT. In Wisconsin, premiums in 2020 would increase by $372 million:
- Fully insured large employers and their employees will see premiums increase $458 for family coverage;
- Fully insured small employers and their employees will see their premiums increase $485 for family coverage;
- Seniors and disabled individuals in Medicare Advantage plans will see their premiums increase $462 per couple;
- Consumers in the individual market will see their premiums increase $207 per policy; and
- State taxpayers will incur an additional cost of $34 million to the State’s Medicaid program.
While no one should have to worry about a preexisting condition denying them access to health care services, it is equally important to understand that increasing taxes does nothing to improve the overall health care system or address the rising costs of care.
Additionally, rising costs in insurance premiums adversely impact the bottom line of all employers that provide health insurance to their employees, diverting funds that could be used to hire and train additional workers or for investments needed for expansion.
Congressional action to delay or repeal the HIT will result in cost savings to businesses, middle-class families and seniors across Wisconsin.
–Chris Reader is the Director of Health & Human Resources Policy at Wisconsin Manufacturers & Commerce (WMC), the statewide chamber of commerce and manufacturer’s association.