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Courtney’s Effort to Scrap Looming ‘Cadillac Tax’ Included in Final 2020 Budget Package

December 16, 2019
Press Release

WASHINGTON, DC – Today, Congressman Joe Courtney (CT-02) announced that his 10-year effort to repeal the looming 40% excise tax on certain employer-sponsored health insurance plans, known as the “Cadillac Tax,” has been included in the final negotiated spending package to fund the government in Fiscal Year (FY) 2020. The bill text, made public this afternoon, includes the provision Rep. Courtney has fought for to repeal the Cadillac Tax through his bill, the Middle Class Health Benefits Tax Repeal Act (H.R. 748).

“Repeal of the Cadillac Tax is a huge win for middle class families who were facing a misguided tax on their hard-won health benefits,” Rep. Courtney said. “For nearly a decade, a broad and bipartisan coalition of members of Congress, labor organizations and business groups, and patient advocates have been united in their efforts to stop this tax from ever going into place. Our message has been clear since day one: at a time when American families face increasing anxiety about rising health care costs, Congress should not compound the problem by taxing the health benefits they rely on. The results of those efforts were seen on the House floor earlier this year, when the House voted resoundingly 419-6 to scrap this tax once and for all. Congress now has a chance to finish the job by bringing this misguided policy to an end once and for all this week. I commend House Speaker Nancy Pelosi and House Ways and Means Committee Chairman Richie Neal for their support in helping to achieve this victory for working families and employers across the country.”

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. Earlier this year, Rep. Courtney secured a victory for his effort to repeal the Cadillac Tax when the House voted in an overwhelmingly bipartisan fashion to pass H.R. 748 by a margin of 419-6.

The House and Senate are expected to vote on the final negotiated spending package for FY2020 later this week.

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.