House Votes to Repeal Obamacare’s “Cadillac Tax”

July 18, 2019

On Wednesday, July 17th, the House overwhelmingly voted to fully repeal the 40 percent excise tax, commonly called the “Cadillac Tax,” that will impact most employer-sponsored health insurance plans.

NAW strongly supports the full repeal of the Cadillac Tax because this tax inevitably forces the reduction of employee benefits and, because of the flawed indexing provisions of the underlying Affordable Care Act, this tax will affect most plans in a few years.  Passed as part of the Obamacare legislation the Cadillac Tax was originally set to take effect in 2018.  Realizing the unpopularity of the Cadillac Tax, however, Congress has twice delayed its implementation until 2022.

Through the multiple health care coalitions NAW helps manage, we have arranged and participated in well over 60 meetings on the Hill — this year alone — with key Committee and Member staff advocating for a full repeal of the Cadillac Tax, the Health Insurance Tax (HIT) and the medical device tax.

While we appreciate prior delays of this tax, uncertainty remains in the employer healthcare market as the U.S. Treasury Department begins to develop proposed rules for its implementation.  Employers make plan decisions well in advance of the beginning of a coverage year and looming proposed rules have a direct impact on plan decisions that are being made now for the next several coverage years.  Full repeal of the Cadillac Tax is extremely timely.

NAW is committed to ensuring that employer-sponsored coverage is strengthened and remains a viable, affordable option for decades to come.  We urge the Senate to quickly pass this legislation, fully repealing the Cadillac Tax once and for all.