WASHINGTON, D.C - U.S. Senator Martin Heinrich (D-N.M.) worked to secure a two-year delay of a provision in the Affordable Care Act (ACA) known as the "Cadillac Tax," which would tax high-cost health insurance plans and impact health benefits for thousands of New Mexican workers. The provision to delay the tax was included in the "omnibus" spending bill that was announced last night by Democratic and Republican leaders that Congress will soon vote on.
"Delaying this excise tax is a victory for the middle class as we continue to fight for its full repeal. Eliminating this onerous tax on employees' health coverage will protect important benefits for workers and ensure that businesses and families get a fair deal," said Sen. Heinrich. "The landmark reforms in the Affordable Care Act have given thousands of New Mexicans access to quality, affordable health care for the first time in their lives. But even the strongest supporters of the law know it isn't perfect and that there are some parts that need to be fixed. New Mexicans can always count on me to seek bipartisan, results-oriented solutions to the pressing challenges we face, and making the ACA work for everyone is no exception."
Senator Heinrich joined U.S. Senator Dean Heller (R-Nev.) in leading the bipartisan effort to eliminate the Cadillac Tax. The senators introduced the Middle Class Health Benefits Tax Repeal Act to fully repeal this excise tax.
The Cadillac Tax would tax employers whose health insurance plans cost more than $10,200 a year for individuals and $27,450 a year for families at 40 percent of the cost above those limits. The tax would force many employers to pay steep taxes on their employees' health plans and flexible spending accounts, and possibly eliminate some employer-provided health coverage plans altogether.
In New Mexico, small business owners, labor unions, counties, rural electric co-ops, and municipalities all oppose the tax. Across the state, 751,000 workers--including 43,000 union employees--who rely on employer, provided health insurance could experience significant changes to their health care as a result of this tax.