Thursday, February 01, 2018

Fees & Taxes

A few weeks ago, Patrick blogged on the Health Insurance Tax (HIT) that had been in time-out for the 2017 tax year, but has now roaring back to life:

"For 2018, the amount this tax must generate is $14.3 billion - meaning insurers must generate $22 billion of additional premiums to pay for it."

As long-time readers know, companies (insurance or otherwise) don't actually pay taxes, so this is actually a tax hike on covered individuals.

So why are you beating this lifeless equine?

Well, because Patrick also pointed out that:
"The tax applies to all fully insured coverage including:

  • Individual On Exchange
  • Individual Off Exchange
  • Small Group Fully Insured - Both ACA and Pre ACA
  • Large Group Fully Insured - Both ACA and Pre ACA
  • Medicare Advantage
  • Medicare Part D
  • Medicaid Managed Care"
Unfortunately, that list was non-exhaustive; that is, it applies to other lines of coverage, as well.

My go-to carrier for non-medical (aka "ancillary") coverage is Companion Life. Non-med group plans would include short and long term disability, dental and vision, that kind of thing. As Companion alerted me by mail yesterday, some of* these lines of coverage are also subject to the Health Insurance Issuer Fee, and it's not insignificant:

"The ACA fee for 2018 will be 3.5% of dental and/or vision premiums."

As with other carriers, Companion breaks these out on their premium notices (invoices) because they "believe this is the most transparent way to display this fee."


[* IB Thanks to commenter farmbellpsu for the correction]
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