Effective 2018, there is a 40 percent excise tax on high-value plans more than $10,200 for individuals and $27,500 for families. The high cost plan tax is on the insurer or plan administrator. The goal of the tax is to eliminate overly generous health care benefits that are often offered in lieu of higher wages. In a 2015 report the Kaiser Family Foundation found that 15% of employers currently have plans that would exceed the threshold, and estimate that 42% of businesses would do so by 2028. The report also identified three main effects the tax would likely have on healthcare plans:
- The complexity of the tax may cause employers to simplify their health benefit offerings, likely creating more out of pocket costs for employees.
- The threshold may be passed for some employees within an organization but not for others if employees are allowed to choose benefits. Employers would likely restrict available benefits to combat this problem.
- The significant tax rate may cause employees to limit employee choice generally and even among core health insurance offerings.
Congress recently passed a two year “Cadillac Tax” delay, postponing the tax until 2020. Watch this webinar for more information about proposed excise tax regulations.
Would establish new requirements applicable to nonprofit hospitals. This includes a periodic community needs assessment, financial assistance policy requirements, limitation on charges to patients, collection practices reform and new reporting and disclosure requirements.