January 24, 2018

Healthcare Implications of Anti-Government Shutdown Bill

After a brief government shutdown, President Trump signed the Extension of Continuing Appropriations Act, 2018 (ECAA). The Act includes provisions that suspend or delay three health care related taxes imposed by the Affordable Care Act. The taxes that are affected include:

  1. Suspension of the Health Insurer Fee for 2019. Although the fee remains in place for 2018, the fee will not apply to 2019 fully insured medical plans.
  2. Delayed the start date of the so called “Cadillac Tax” on high cost health plans until 2022.
  3. Suspension of the Medical Device Tax for two years. (2018 and 2019)

In addition to the tax implications, the Act extends the Children’s Health Insurance Program (CHIP) for an additional six years. The CHIP program provides coverage to children from families who earn too much to qualify for Medicaid, but not enough to afford quality private insurance. Without this extension, several states faced funding shortfalls for their CHIP programs.

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