All Americans who bought health insurance policies this year – not just those enrolled in Obamacare – face a 41 percent increase in excise taxes because of hidden fees contained in an obscure section of the Affordable Care Act, according to an investigation by The Daily Caller News Foundation.
Virtually everyone who pays for health care insurance this year will be affected by the tax. The little-known tax was imposed on all consumers regardless of whether they obtained their insurance through Obamacare or through their employer or as individuals in the private market.
This year the tax will cost individuals more than $500 in extra premiums according to one actuarial estimate. Families who purchased insurance will see their premiums go up by more than $700.
The new tax also hits senior citizens who rely on Medicare Part D and Medicare Advantage. It will land on the nation’s poor who depend upon Medicaid-managed care programs.
The 41 percent sticker shock increase doesn’t stop in 2015, however. Over the next four years, the statutorily mandated Obamacare fees are expected to double again.
Over the next decade, consumers will pay more than $145 billion for the tax, according to the Congressional Budget Office. The levy will continue to go up each and every year into the future.
The tax was buried by congressional authors in section 9010 of the law and was envisioned as a way to raise future funds to pay for Obamacare.
The Obamacare fees were designed by the program’s authors to be delayed, kicking in only in 2014 at $8 billion and mushrooming into a $14.3 billion annual price tag on insurance policies by 2018.
Republican Sen. John Barrasso, who favors repeal of section 9010, said the tax “is another example of how the president’s health care law was designed so the most painful parts of the law kick in years later.”
CBO reported the fee was a “statutorily fixed” amount that must be collected each year from consumers, as opposed to a percentage rate.
The statute describes the levy is an “annual fee” but health-care economists say it has been commonly referred to as an excise tax.
The Joint Committee on Taxation said the Obamacare tax was “similar to an excise tax based on the sales price of health insurance contracts.”
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