Jenniffer Gonzalez Introduces Bipartisan Bill to Lower the Cost of Healthcare Premiums

Statement

Congresswoman Jenniffer Gonzalez- Colon introduced H.R. XX, the Territory Health Insurance Tax Relief Act (HIT), a bipartisan bill that would benefit Puerto Rico in over $200 million per year.

The Health Insurance Tax (HIT) included in Section 9010 of the Affordable Care Act (ACA) requires insurance companies to pay a tax when they have a level of net premiums written exceeding $25 million.

According to an analysis of ACA conducted by the Congressional Budget Office (CBO) during 2009, the impact of HIT as well as other taxes provided by ACA would be transferred by insurers to their customers through an increase in the cost of premiums.

In the particular case of Puerto Rico, it is estimated that the HIT has had the effect of increasing the cost of the premiums by 2% and it is expected to successively increase even more. According to an interpretation of CMS, Puerto Rico is not eligible to establish a health insurance exchange, and it is not eligible for the credits and subsidies that are financed with the HIT.

The bill would amend the Affordable Care Act's (ACA) Section 9010 resulting in the reduction of health insurance premiums that doesn't benefit the current situation of the Island and a reduction of costs of $200 million per year.

The effect of this bill is to eliminate the payment of tax to insurers by the federal government and that is transferred by these to the subscribers in their health insurance premiums, saving money to each insured in the payment of premiums for a tax that is transferred and does not allow the benefit of credit in hospitals or insured in the territories in contrast to the federal jurisdiction.

The Territory Health Insurance Relief Act (HIT) is co-sponsored by Rep. Stacey Plaskett (D-USVI), Rep. Amata Radewagen (R-American Samoa) and Rep. Michael San Nicolas (D-Guam).

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