On Wednesday, July 17, the U.S. House of Representatives is scheduled to vote on a bill to repeal the provision of the Affordable Care Act (ACA) known to many as the “Cadillac Tax.” This top legislative priority for PIA National, H.R. 748, the Middle-Class Health Benefits Tax Repeal Act, is sponsored by Reps. Joe Courtney (D-CT) and Mike Kelly (R-PA) and is overwhelmingly bipartisan, as demonstrated by its 350-plus cosponsors.

The Cadillac Tax was a provision of the ACA but has never been implemented, in large part due to advocacy by PIA members. If permitted to go into effect, this 40 percent tax on so-called “overly generous,” high-cost health plans would begin in 2022. The tax, which is assessed using the chained consumer price index (CPI), would apply to fully insured and self-funded employer health plans and will tax policies with limits that exceed the annual thresholds of $11,100 for individual coverage and $29,750 for family coverage.

Because the Cadillac Tax is indexed to chained CPI, over time, more and more employer-sponsored health plans will be affected, because the benefit thresholds will increase at a rate slower than that of inflation. This will subject an increasing number of Americans to the Cadillac Tax sooner, because inflation will outpace increases in the thresholds using chained CPI.

PIA National has long sought to prevent this tax from ever being implemented, successfully advocating for its delay twice. Even though the tax will not take effect until 2022, its very existence creates instability in the health insurance market while putting consumers’ health care at risk.

PIA National urges the House to pass H.R. 748 on Wednesday. PIA members from around the country can take action before the vote by sending a grassroots action message that can be found here.