Friendly reminder for insurers: the newly-instated health insurance tax (HIT) of $8 billion is due September 30. But insurers are not left alone to handle and figure out how to pay such a hefty sum. The industry as a whole is turning to taxpayers to help cough up the money, reports Kaiser Health News.
Since implementation of the HIT, insurers have voiced their opinions on the tax and its possible negative impact.
"This situation results in the federal government taxing itself and taxing state governments to fund the higher Medicaid managed care payments required to fund the Affordable Care Act health insurer fee," said a report by Medicaid Health Plans of America, a trade group, according to KHN.
And last year, Aetna CEO Mark Bertolini claimed the tax would cost the insurer about $600 million more in fees, FierceHealthPayer previously reported.
So to assist with paying the tax, many private insurers are raising premiums and also shifting the fees onto their Medicaid members.
With regards to Medicaid plans, here's a quick look at the estimated amount certain states will dish out and how much the federal government will cover. On average, the federal government will pay 57 percent, notes KHN.
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For Texas: estimated tax of $220 million, with the state paying $90 million and federal government supplying $130 million.
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For Newly-Medicaid-alternative-expanded-Pennsylvania: estimated tax of $139 million, with the state paying $64 million and the federal government supplying $75 million.
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For Tennessee: estimated tax of $160 million, with the state paying $50 million and the federal government supplying $110 million.
Many Medicaid officials worry the tax prohibits the amount that could have been spent on providing other services, or for offering a greater variety of providers, reports KHN.
While such fees are only an estimated amount, it's possible the HIT could bring in $100 billion over the next 10 years from all insurers.
"I do not feel I am getting anything in return for this," Tennessee Medicaid Director Darin Gordon told KHN.
For more:
- here's the KHN article