Surprise, Surprise, Obamacare Includes a Massive Sales Tax on Your Healthcare Insurance

As Carlyle Group founder and war profiteer David Rubinstein once told me about some legislation, "The devil is in the details."

Maybe this is what Nancy Pelosi meant, when she said that Obamacare needs to be passed so that we can find out what is in it.



Well, we are starting to find out.

Lindsay Boyd at Forbes informs us (my highlights)

While much of the dialogue on healthcare reform centers on the federal mandate of health coverage for all Americans – which many conservatives call the largest tax increase in U.S history – less attention is being given to the massive sales tax increase on the purchase of health insurance also implicit within the legislation that will dramatically escalate costs for employers and consumers.[...]The Joint Committee on Taxation released a reportto Committee of Ways and Means Chairman Dave Camp shortly after the Supreme Court ruling thatrecalculates the costs to insurers, consumers and businesses under the new plan. According to their report – which does not include updated scores for the individual mandate, the employer mandate, or certain other revenue effects – the tax increases that remain on the books will cost taxpayers more than $675 billion over the next ten years. Chief among these will be the sales tax on the purchase of health insurance, totaling $101.7 billion, and making it larger than all the other industry-specific taxes combined.

“The health insurance tax will add a financial burden on families and small businesses at a time when they can least afford it, and it should be repealed, ” says AHIP, a trade association representing health insurance industry providers, in today’s call for the repeal of the health insurance tax before it can take affect. As they report,

· Starting next year the ACA imposes a new $100 billion tax on health insurance. The tax will start at $8 billion in 2014, increasing to $14.3 billion in 2018, and will continue to increase each year.

· The health insurance tax is larger than the device tax and the prescription drug tax combined.

· The health insurance tax will increase costs for individuals and families purchasing coverage on their own, small businesses, seniors and people with disabilities enrolled in a Medicare Advantage plan, and state Medicaid managed care plans.

· The health insurance tax is far greater than the minimum penalty for those who choose not to buy health insurance – further incentivizing young, healthy people to forgo purchasing insurance until they need medical care.

President Obama views the tax revenue generated by the health insurance sales tax and the twenty one other tax hikes in the ACA as essential to fund the his expensive Obamacare reform. John C. Goodman, author of Priceless: Curing the Healthcare Crisis (Independent Institute, 2012) and President of the National Center for Policy Analysis, joins AHIP’s Ignani in his dissention of Obama’s costly healthcare tax increases, claiming they are for American families already wrought with worry amidst an economic recession.

“The ObamaCare health insurance tax hits some of the most vulnerable people in our society, including poor people in Medicaid managed care plans and seniors in Medicaid advantage plans. It is also a tax on middle-income families who were promised by this administration that taxes would never rise.”[...]Unfortunately, as Goodman predicts, “this is only one example of many middle income taxes buried in ObamaCare.”