Manufacturers are committed to offering the highest quality healthcare to employees. But the cost of health insurance continues to rise, and three previously-delayed health care taxes are set to go into effect unless Congress acts. Catie Kawchak, National Association of Manufacturers Director of Infrastructure, Innovation and Human Resources, discusses the continued urgent fight against higher costs.
What are the taxes manufacturers are fighting against?
Manufacturers are fighting against three major taxes on health care: the Health Insurance Tax (HIT), a multi-billion dollar tax imposed on health insurance premiums; the so-called Cadillac Tax, a 40 percent tax on more expensive health insurance plans; and the medical device tax, a tax on life-saving medical devices.
Why do these taxes matter for manufacturers?
All three would increase the cost of care and undermine employees’ wellbeing. According to Oliver Wyman global consulting, HIT could raise the cost of premiums by an additional $500 for the families of small business owners and their employees. The Cadillac Tax places a 40 percent tax on “high-cost” health insurance plans, making it difficult to provide high-quality insurance to employees. The medical device tax would cost manufacturers $2 billion annually, diverting resources from investment in life-saving equipment and making it harder for these businesses to expand.
What is the overall impact on manufacturers?
Manufacturers provide great benefits to their workers not only to attract or retain employees but because it’s the right thing to do. Tax proposals like these make it more difficult to provide the care that our employees depend on and to invest in life-saving medical innovations. Manufacturers employ about 13 million people across the country, and these taxes would harm them and their communities.
Why does this matter now?
Congress must move quickly to prevent these taxes from impacting manufacturers. HIT and the medical device tax are both set to go into effect on January 1, 2020, meaning Congress only has a few weeks to stop or delay these penalties. And even though the Cadillac Tax doesn’t go into effect until 2022, manufacturers have already begun to prepare for a 40 percent tax hike on high-cost health benefits. The only way to prevent these tax hikes from harming manufacturers is for Congress to repeal or delay them in the coming weeks. That’s why the NAM has been working so hard on this issue.
Manufacturers are united with bipartisan lawmakers to stop these harmful taxes. In November, bipartisan freshman congressmen urged their colleagues to address the HIT this year; with the NAM’s strong support, the House already passed Middle Class Health Benefits Tax Repeal Act of 2019 by a vote of 419-6 to repeal the Cadillac Tax; and legislation to repeal the medical device tax has the support of a majority of the House. On Wednesday, the NAM united with fellow advocacy leaders at the Business Roundtable and U.S. Chamber of Commerce to call for repeal of all three taxes this year. Congress should end them now.
ANN ARBOR, MICH. – The National Association of Manufacturers announced today that it will offer an association health plan to its members, extending affordable health care to small and medium-sized manufacturing companies and member associations in approved states. In states where the association health plan is not available, the NAM will connect manufacturers with available small-group options in their state.
“This association health plan is another step in our work to make the NAM a one-stop shop for manufacturing across the United States,” said NAM President and CEO Jay Timmons. “With small and medium-sized businesses making up more than 90 percent of our membership, this plan will help provide health care and reduce uncertainty for workers and their employers across the country.”
The plan, called NAM Health Care (www.namhealthcare.com), was developed to meet manufacturers’ unique health care needs. It will offer a portfolio of health benefits options insured by UnitedHealthcare. In states where these plans are available, businesses with 2 to 99 employees will be able to choose from a variety of PPO (Preferred Provider Organization) and HSA (Health Savings Account) health plans. Members will also have access to UnitedHealthcare’s Choice Plus care provider network of more than 1.2 million physicians and care professionals and 6,500 hospitals and other care facilities nationwide. UnitedHealthcare will work with any licensed or appointed agents who want to sell NAM Health Care.
In addition, Mercer will provide the NAM’s small business members with consulting services regarding health benefits offerings and contribution strategies, marketing support to educate and enroll their employees, plan administration and compliance services. The Mercer Affinity 365+sm platform will provide members technology for quoting, enrollment and ongoing benefits administration to drive cost efficiencies and facilitate employee engagement.
Association health plans allow companies to band together to manage and purchase health care coverage that may save on annual health insurance costs by providing plans that are typically enjoyed by larger companies at a competitive price. Under NAM Health Care, eligible member companies also will have access to supplemental benefits, including dental, vision and life.
“The work that manufacturers are doing every day grows the economy and strengthens our country, and they deserve the health care they need to do that job with certainty and support,” said Timmons. “At the NAM, we are proud to help lower costs and increase competitive health coverage for the men and women who make things in America.”
NAM Health Care is quoting these plans for eligible member groups for a Sept. 1, 2019, enrollment date. To enroll in these plans, where available, interested businesses may visit www.namhealthcare.com.