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February 24, 2017

House GOP leaders this morning released a “discussion draft” of legislation designed to repeal and replace the Affordable Care Act.  To our regret, the legislation includes a “pay-for” provision that would scale back the employer exclusion from taxation for benefits from 100 percent to 90 percent.

We have consistently opposed efforts to shift costs to employer plans in order to pay for “fixes” in the individual insurance marketplace, and we are urging all of our members to contact your Members of Congress to urge opposition to any repeal/replace plan that taxes employer group health insurance benefits.

This discussion draft is a critical first marker in the effort to use the congressional “reconciliation” process to reform Obamacare. You can read the initial analysis from our partners at Steptoe & Johnson here.

The plan most importantly would scrap both the Obamacare exchange subsidies and Medicaid expansion – both of which will be wildly controversial.  The only revenue generator for the other reforms proposed is the scale-back of the employer exception to 90 percent – a payroll tax increase for millions of Americans.

The legislation could be “marked up” in House committees as early as next week and voted upon by the House of Representatives.  The next steps of the Trump Administration and the Senate are unclear, as the kettle reaches a boiling point.  With so many uncertainties, we urge you to let Members of Congress know of our strong opposition to taxation of employer plans. 

Our ask: Call your representatives and senators NOW and ask them to OPPOSE any new taxes on employer provided health insurance.

The Capitol switchboard’s phone number is 202-225-3121. Find your Members of Congress  at: or Use those sites to find your member of the House of Representatives and Senators and click through to send them a message.

During your call, please utilize the following talking points and resources:

  • It is important to remember the significant role American businesses play in our healthcare system. Approximately 177 million Americans (61 percent of covered Americans) get their health coverage through an employer.
  • Imposing a tax on employer-sponsored health plans is a dangerous policy experiment that could significantly erode employer-sponsored health coverage.
  • Any cap on the tax exclusion is a direct tax on employees and the middle class. We strongly oppose solving problems in the individual health marketplace with a measure that would tax benefits in the employer marketplace.
  • American businesses are highly motivated to control health costs while maintaining a healthy, engaged workforce. In fact, 83 percent of employers with group health plans offer wellness programs. Placing arbitrary limits on the tax exclusion hinders their ability to offer a sustainable benefit package that meets the needs of their employee population.
  • We need to stabilize the individual marketplace and not destabilize the employer-sponsored system that covers more than half of all Americans.
  • One-pager: Preserve the Tax Treatment of Employer-Sponsored Insurance
  • Infographic: Do No Harm on Employer Plans

This Congress and Administration campaigned on the promise to make health insurance more affordable, but raising taxes on the 177 million Americans that receive their insurance from the employer does the exact opposite.

Please contact our government affairs team via  with any questions.

Thank you, as always for your involvement.