Taxes and Fees

Study: Healthcare law’s insurance tax will raise premium costs

Insurance premiums could increase by thousands of dollars because of a new tax in President Obama’s healthcare law, according to a study commissioned by the insurance industry.

The healthcare law imposes several new taxes, including a tax on the insurance industry. The amount the government will collect will rise each year, and is expected to raise $100 billion over 10 years.

The health insurance tax will raise families’ insurance costs by as much as $7,000 over a decade, according to a study conducted by the firm Oliver Wyman on behalf of America’s Health Insurance Plans (AHIP), the insurance industry’s leading trade group.

{mosads}Premium increases will vary from state to state, Oliver Wyman said. But on average, the cost of a family plan sold through a large employer could cost about $7,200 more over 10 years — about $720 per year. 

“With full implementation of the ACA a year away, the focus needs to be on making coverage more affordable,” AHIP President Karen Ignagni said in a statement. “Taxing health insurance will have the opposite effect by making it more expensive.”

Insurers have pressed Congress to repeal the tax, saying it’s part of a series of policies, set to take effect at the same time, that will cause an dramatic spike in premiums.

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