HEALTHCARE/OBAMACARE(ACA)/POLITICS: “Senate Republicans set on reworking the Affordable Care Act are considering taxing employer-sponsored health insurance plans, a move that would meet stiff resistance from companies and potentially raise taxes on millions of people who get coverage on the job.
The move could raise billions in revenue that could be used to help stabilize the fragile individual insurance market. But it could be politically risky, since it could expand the impact of GOP health proposals from Medicaid recipients and those who buy insurance on their own to the roughly 177 million people who get coverage through their employers.
A number of lawmakers are open to the idea, including Sen. Mike Lee (R., Utah), GOP aides said, but there is no consensus yet on whether it should be included in the draft bill being written during this week’s congressional recess.
Under longstanding tax law, compensation in the form of health insurance isn’t treated as income for workers. That means employers can deduct the cost and the value isn’t subject to payroll taxes or individual income taxes. It is a system that economists say distorts the market in favor of generous insurance packages, but like other tax breaks, it has proven popular and difficult to dislodge.”
-Stephanie Armour and Kristina Peterson, “GOP Senators Weigh Taxing Employer-Health Plans,” The Wall Street Journal online, June 1, 2017 6:57pm