U.S. Sen. John Barrasso (R-Wyo.) is again trying to repeal part of the Affordable Care Act he says could cost the country as many as 262,000 jobs through a formally structured fee on health insurers starting in 2014.
The fee charged will be based on a tiered structure taking into account net premiums written in the fully-insured market. The more premiums an insurer receives, the larger percentage fee it will pay. Insurers with less than $25 million in net premiums will not pay the fees at all, according to Seton Hall Law School’s Center for Health & Pharmaceutical Law & Policy. Meanwhile, insurers collecting between $25 to $50 million are taxed on only half of their net premium revenues. Beyond $50 million, all premiums will be fully taxed.
By 2020, the new fee structure would haul in an estimated $90 billion to federal coffers, something proponents of the fee say is necessary to keep the Affordable Care Act affordable for U.S. government. Obamacare was shopped out to voters with a promise of budget neutrality, making this and many other fees and taxes – like a medical device tax – essential to implement the law.