Heller introduces bill to repeal Obamacare’s ‘Cadillac tax’

WASHINGTON — As Congress prepares for the political brawl over the dismantling of Obamacare, U.S. Sen. Dean Heller rolled out a bipartisan bill Tuesday to repeal a tax on high-end insurance plans.

Heller, R-Nev., introduced legislation with U.S. Sen. Martin Heinrich, D-N.M., that would prevent the so-called “Cadillac tax” from being implemented in 2020.

“We are going to rein it in,” Heller said at a news conference with Heinrich.

The 40 percent tax, part of the Affordable Care Act, would be levied on employer-sponsored health care plans, including those offered to government employees, service industry workers, small-business owners and retirees.

Heller said 1.3 million people in Nevada would feel the pinch of the tax if it were allowed to become law.

“The goal of health care reform should be to lower costs for those who already have health benefits, and expand access to those who do not currently have coverage. The Cadillac tax achieves neither,” Heller said.

Heinrich said the term “Cadillac tax,” coined by framers of the Affordable Care Act, is a misnomer, because it implies that people subjected to the tax have gold-plated plans. He said many of the workers subjected to the tax do not drive Cadillacs and are more likely to drive “F-150” pickups.

Companion legislation was filed in the House by Rep. Mike Kelly, R-Pa., and Rep. Joe Courtney, D-Conn.

The bipartisan, bicameral legislation to repeal the tax is supported by Culinary Workers Local 226 and Bartenders Local 165 in Nevada, which represent 57,000 workers in Las Vegas and Reno.

“It’s time to make health care work for the middle class. Politicians must stop ideological battles and get down to fixing the American health care system so that it works for the hard-working men and women of this nation,” said Geoconda Arguello-Kline, secretary-treasurer for the Culinary union.

“That starts with the repeal of the 40 percent tax on worker’s health benefits, and ends with a shift to making health care affordable and accessible and efficient,” Arguello-Kline said in a statement.

Still, the legislation is likely to get caught up in political fighting in Congress, where Republicans in the House and Senate have vowed to dismantle the Affordable Care Act over objections by Democrats concerned that repeal could force 20 million Americans to lose coverage.

The Senate is expected to vote this week on a framework that would allow the GOP to repeal the Affordable Care Act, President Barack Obama’s signature legislation, before it is replaced with an alternative plan.

Heller acknowledged the ideological split that exists as lawmakers move forward.

He said he would hope the bill, because of bipartisan support, would stand alone, but that it could become an amendment to a larger piece of legislation.

Holding the news conference with Heinrich, Heller said, would “send the right message to leadership.”

Last year, a bipartisan majority in the House and Senate voted to delay implementation of the Cadillac tax from 2018 to 2020. Heller said that that support still exists to completely repeal the tax.

The Obama administration had fought against repeal of the tax, which would be imposed on plans that exceed benefit thresholds of $10,800 for self-only coverage and $29,100 for family plans in 2020.

Delaying the tax for two years, until 2020, is expected to cost the government $9 billion.

President-elect Donald Trump said he is in favor of repealing the tax, as well as other taxes imposed in the Affordable Care Act.

Republicans have not offered alternative ways to address the revenue shortage if taxes in the Obamacare legislation are repealed.

Contact Gary Martin at gmartin@reviewjournal.com or at 202-662-7390. Follow @garymartindc on Twitter.