For Immediate Release
The 8 Largest Health Insurance Companies Will Get a $72 Billion Tax Cut From GOP Health Care Repeal Over Next Decade
Top insurers’ profits are up one-third since Obamacare kicked in to $25 billion
WASHINGTON - While millions of people will lose their health insurance and health coverage as a result of Republican plans to repeal the Affordable Care Act (ACA), the nation’s 8 largest health insurance corporations will get a tax cut of about $72 billion over the next decade, according to new estimates from Americans for Tax Fairness. These companies will get nearly half of the $145 billion 10-year tax cut for the entire insurance industry estimated by the Joint Committee on Taxation.
“It’s appalling that Republicans in Congress would yank healthcare from 20 million people and give insurance companies a $72 billion tax cut,” said Frank Clemente, executive director of Americans for Tax Fairness. “Outrageous. President Trump promised not to cut Medicaid, and Republicans should keep that promise. We can’t afford any health care legislation that takes coverage away from Americans so that wealthy corporations can have a tax cut.”
Health Insurance Provider Fees, Top 8 Insurers, 2014-2026
Share of Industry-Wide Fee, Average 2014-2016
2018 - 2026
Total, Top 8
Source: ATF analysis of companies’ 10K filings with the Securities and Exchange Commission. Data is available here. *Health Net was acquired by Centene in 2016. Centene’s fee for 2018-2016 is estimated based on the sum of Centene’s and Health Net’s average shares of the industry-wide fee for 2014-2015.
These large insurance companies have collectively increased their U.S. profits by one-third between 2011 and 2016 as the Affordable Care Act kicked into place—from $19.1 billion in 2011 to $25.3 billion-in 2016. These companies are very profitable and do not need a $72 billion tax cut.
They especially don’t need a tax cut that would be paid for by steep Medicaid cuts and over 20 million Americans losing access to health coverage.
Source: Institute on Taxation and Economic Policy and ATF calculations based on companies’ 10K filings with the Securities and Exchange Commission. Data is available here.
As part of the ACA, a fee was levied on health insurance providers that benefited from millions of new customers. Each company’s share of the fee is based on their market share of net premiums collected from covered entities under the ACA. The fee went into effect in 2014, when the overall fee for the industry was set at $8 billion. For 2015 and 2016, the industry-wide fee was set at $11.3 billion. The 2016 Consolidated Appropriations bill suspended the fee for 2017, but under current law it will be reinstated in 2018 at $14.3 billion. Each year thereafter, the industry-wide fee will increase according to the overall rate of premium growth in the health care industry.
We estimate each company’s savings from 2018 through 2026 by multiplying the company’s average share of the industry-wide fee by the $145 billion that the Joint Committee on Taxation estimates the repeal of the fee will cost in revenues over the next 10 years.
ATF’s estimates are available here.
FRIENDS: Now More Than Ever
Independent journalism has become the last firewall against government and corporate lies. Yet, with frightening regularity, independent media sources are losing funding, closing down or being blacked out by Google and Facebook. Never before has independent media been more endangered. If you believe in Common Dreams, if you believe in people-powered independent media, please support us now and help us fight—with truths—against the lies that would smother our democracy. Please help keep Common Dreams alive and growing. Thank you. -- Craig Brown, Co-founder
Americans for Tax Fairness (ATF) is a diverse campaign of more than 425 national, state and local endorsing organizations united in support of a fair tax system that works for all Americans. It has come together based on the belief that the country needs comprehensive, progressive tax reform that results in greater revenue to meet our growing needs. This requires big corporations and the wealthy to pay their fair share in taxes, not to live by their own set of rules.