Attached to the 1/22/18 short term spending bill passed by Congress are delays of three taxes under the Affordable Care Act (ACA), and a six-year extension of the Children’s Health Insurance Program (CHIP).
Tax and Fee Delays
- “Cadillac Tax” (40% Excise Tax) is delayed two more years
- New effective date of 1/1/22
- Health Insurance Industry Fee (aka Health Insurer Tax)
- Has been suspended for one year (2019)
- Applies only to insured business
- Is based on each insurer’s share of the taxable health insurance premium base
- Helps fund federal and state Marketplaces/Exchanges
- Paid by Insurers
- Tax deductible for employers as part of premium
- Medical Device Tax is suspended for two years (2018-2019)
- This delays the excise tax (2.3%) on the sale of certain medical devices by the manufacturer or importer of the device
- This moratorium was set to expire on 12/31/17 but has been suspended for two more years
Should you have any questions, please reach out to your FosterThomas benefits account manager or customer service representative.