The Affordable Care Act levies new taxes that are earmarked for different provisions that came into being with the passing of the act. Two of these taxes are now in effect as of January 1, 2014, and are funded via small group premiums only. Following is an explanation of these new taxes, and how they are applied to small group policy holders:
- The health insurer tax is intended to offset the cost of subsidies and tax credits for those buying policies through the health insurance exchanges. All small groups are required to pay this tax on an annual basis, and it is expected to be 2.3 percent of premiums.
- The transitional reinsurance contribution program tax is a short-term tax that will sunset in 2016. Funds are used to assist with covering the costs of individuals with the highest risk in the non-group market. The cost of this tax is estimated to be $5.25 per each enrolled member, or about 1.5 percent of dues and/or premiums.
Do you live in the Los Angeles, California, area and want to buy an insurance policy Contact Save-On Health Insurance Services to speak to an agent about your needs today!
