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After 10 Year Effort, House Votes to Pass Rep. Courtney’s Bill to Repeal Cadillac Tax

July 17, 2019
Press Release

WASHINGTON, DC – This evening, the House overwhelmingly approved the Middle Class Health Benefits Tax Repeal Act (H.R. 748), bipartisan legislation introduced by Rep. Courtney that would repeal the looming 40% excise tax on certain employer-sponsored health insurance plans known as the “Cadillac Tax.” Rep. Courtney has sought to eliminate this damaging tax on health care for American families since 2009, and has introduced legislation to bring about its repeal since the 114th Congress. Upon reintroduction of his bill to repeal the Cadillac Tax this year, Rep. Courtney was joined by original co-sponsors Reps. Mike Kelly (R-PA), Suzan DelBene (D-WA), Elise Stefanik (R-NY), Donald Norcross (D-NJ), and Chris Smith (R-NJ), and the bill was supported by 369 co-sponsors upon consideration today. Courtney’s legislation has also been publicly supported by a broad coalition of labor, employer and patient advocates such as American Cancer Society and Families USA—staunch supporters of the Affordable Care Act (ACA).

After the House voted 419-6 to approve his bill, Rep. Courtney made the following statement:

“The American people gave Congress a mandate: address the rising cost of health care,” said Congressman Courtney. “Out of pocket costs are increasingly unaffordable for families, even those with insurance. If the 40% tax on employer sponsored health plans goes into effect, the affordability crisis will dramatically worsen. This tax has never generated a penny of revenue, yet it continues to threaten working Americans’ health benefits. After over a decade of work towards this effort, the House did the right thing today for families across America by voting to fully repeal the tax. Now, Senator McConnell must take a cue from the strong statement made today in the House and bring this bill up for a vote in the Senate.”

The “Cadillac Tax” is a 40% excise tax on high-premium employer health insurance plans which many experts say will cause patient deductibles and out-of-pocket costs to rise dramatically. Economists, health care experts, and actuaries project if the tax were to go into effect, employers would reduce the value of their health benefits to avoid the tax threshold, and make up the difference by shifting costs onto workers and their families. They predict that the tax would unfairly and disproportionately impact older workers, smaller businesses, women, workers with dependent children, and those in regions with high health care costs.

A recent report from the Kaiser Family Foundation found 31% of employers offering health benefits would face this tax in 2022, and that number would increase to 46% by 2030. Employers are already shifting health costs on to families – deductibles on employer-sponsored plans have risen 212% over the past 10 years. This trend has exacerbated the growth in the underinsured, with the majority of newly underinsured Americans being those with employer sponsored insurance. Taxing health insurance will worsen and accelerate this trend.

Rep. Courtney has worked to stop the implementation of the “Cadillac Tax” since 2009, when he led a coalition of 190 Members of Congress in writing to Speaker Nancy Pelosi urging her to reject the imposition of an excise tax on high-cost insurance plans. Congressman Courtney has introduced legislation to repeal implementation of the tax in three different sessions of Congress dating back to 2015. In 2015, Courtney’s inaugural Middle Class Health Benefits Tax Repeal Act garnered 188 co-sponsors; in 2017 the number of co-sponsors rose to 304; this year, Congressman Courtney’s legislation garnered 369 bipartisan co-sponsors.

Congressman Courtney’s bill to repeal the “Cadillac Tax” has won support from a wide variety of organizations, from Families USA, American Cancer Society and other patient advocacy groups, to labor organizations like the International Brotherhood of Teamsters, the American Federation of State, County and Municipal Employees (AFSCME), the National Retail Federation (NRF), and many more. A full list of supporting organizations can be found below. For more information on Congressman Courtney’s decade-long effort to repeal the “Cadillac Tax,” and to learn more about how repealing the tax will help keep health care costs down or American families, visit Rep. Courtney’s website, here.

Organizations to announce support for Rep. Courtney’s H.R. 748 include: AFL-CIO; Air Line Pilots Association, International (ALPA); Alliance for Retired Americans (ARA); The Alliance to Fight the 40; Amalgamated Transit Union (ATU); American Benefits Council; American Cancer Society Cancer Action Network; America’s Health Insurance Plans; American Federation of State, County and Municipal Employees (AFSCME); American Federation of Teachers (AFT); Associated General Contractors of America; Association of Flight Attendants—CWA (AFA); Bakery, Confectionery, Tobacco Workers and Grain Millers International Union (BCTGM); CancerCare; Communications Workers of America (CWA); The Council of Insurance Agents and Brokers; Department for Professional Employees (DPE); Families USA; First Focus Campaign for Children; Guild of Italian American Actors (GIAA); Government Finance Officers Association (GFOA); Health Action Council; The Immune Deficiency Foundation; Independent Insurance Agents & Brokers of America; International Association of Fire Fighters (IAFF); International Association of Machinists and Aerospace Workers (IAM); International Association of Sheet Metal, Air, Rail and Transportation Workers (SMART); International Brotherhood of Boilermakers, Iron Ship Builders, Blacksmiths, Forgers and Helpers (IBB); International Brotherhood of Electrical Workers (IBEW); International Brotherhood of Teamsters (IBT); International Federation of Professional and Technical Engineers (IFPTE); International Longshore and Warehouse Union (ILWU); International Union of Bricklayers and Allied Craftworkers (BAC); International Union of Police Associations (IUPA); International Union, United Automobile, Aerospace and Agricultural Implement Workers of America (UAW); Laborers' International Union of North America (LiUNA); National Association of Counties (NACo); National Association of Insurance and Financial Advisors; National Association of Letter Carriers (NALC); National Association of Manufacturers (NAM); National Association of Police Organizations, Inc.; National Business Group on Health; National Education Association (NEA); National Association of Health Underwriters; National Electric Contractors Association; National Federation of Independent Business (NFIB); National League of Cities; National Retail Foundation (NRF); National Rural Electric Cooperative Association; National Taxpayers Union; NTCA – The Rural Broadband Association; Partnership for Employer-Sponsored Coverage; Service Employees International Union (SEIU); Society for Human Resource Management (SHRM); Stage Directors and Choreographers Society (SDC); Transportation Communications Union/International Association of Machinists and Aerospace; Workers (TCU/IAM); UNITE HERE; United Brotherhood of Carpenters and Joiners of America; United Food and Commercial Workers International Union (UFCW); United Steel, Paper and Forestry, Rubber, Manufacturing, Energy, Allied Industrial & Service; U.S. Chamber of Commerce; United Steelworkers International Union (USW); American Postal Workers Union (APWU); National Nurses United (NNU); United Mine Workers of America (UMWA); and WorldatWork.