Washington must preserve what works in our health care system while reforming what does notDownload Talking Points
While the 2010 federal reform efforts included several important consumer protections, they’ve done little to slow the pace of health care cost inflation and have increased burdens on employers. Nationally, health care spending is expected to increase an average of 5.8 percent annually through 2024. At the same time, Washington has made it more difficult and costly for businesses to provide comprehensive health insurance plans to employees and their families. New business costs and mandates will force employers to cut employee benefits and hours, hurting American workers instead of helping them. Washington must preserve what works in our health care system while reforming what does not.
Why it matters
According to the Kaiser Family Foundation, annual premiums for employer-sponsored family health coverage reached $18,764 this year. Getting control of unsustainable health care costs will improve our members’ ability to provide good benefits for their employees and compete in a global economy.
Employer Mandate Repeal
Beginning in 2016, employers with 50 or more full-time equivalent employees (FTEs) were required to provide health insurance to those FTEs or face an Internal Revenue Service fine. This penalty has had severe unintended consequences. It’s caused employers to delay hiring new full-time employees and cut back hours for current workers so they are counted as part-time, instead of full-time. By reducing the hourly standard from 40 hours to 30, the mandate also eroded the historical definition of a “full-time” workweek. Congress should restore the threshold for full-time work to 40 hours per week.
The employee benefits tax, which was passed as part of the 2010 Affordable Care Act, imposes a 40 percent levy on high-end insurance plans provided by employers to their workers. It will take effect in 2022. According to the National Association of Manufacturers, all employers eventually will have to pay the tax, also sometimes referred to as the “Cadillac” tax, which will apply to individual health plans valued at $10,200 annually and family plans worth $27,500.
The Affordable Care Act medical device tax, which is expected to raise $20 billion over 10 years and which the Congressional Research Service called “challenging to justify,” was implemented in 2013 and suspended in 2016. That tax, which imposes a 2.3 percent excise tax on medical device manufacturers or importers at the point of sale will take effect again on Jan. 1, 2020. While this tax will not directly affect the metals industry, it will stifle health care innovation in the United States and lead to higher health care costs for MSCI companies and their employees.
September 18, 2023IRS Stops Processing Employee Retention Tax Credit
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