The Democrat-controlled legislature is quickly and quietly advancing a bill that would raise the cost of health care by $450 for the typical Colorado family.
Senate Bill 215, which was introduced last week and is now pending third reading in the senate, would impose a new tax on health plans that are regulated by the state Division of Insurance.
In a bipartisan deal, Congress recently voted to repeal the federal Health Insurance Tax, a $100 billion tax that hits nearly every health insurance market. The repeal of this tax, which is scheduled to occur in 2021, will be a huge win for Americans across the country.
But unfortunately, it is now looking like many Coloradans are going to be robbed of this much-needed federal tax relief. SB 215, if implemented, would impose a new 1% “fee” on premiums that are collected by non-profit health insurers and a new 2.5% “fee” on premiums that are collected by for profit insurers.
This $100 million a year tax hike could raise the cost of a typical family health insurance plan in Colorado by a whopping $450 a year.
In addition to making it harder for small business owners and employers to continue offering coverage to their employees – particularly now, after weeks for being shut down to stop the spread of the virus – it could also make them slower to rehire after the pandemic and/or leave them with fewer resources available to invest in their business operations.
Adding insult to injury, SB 215 is also likely to result in taxpayers footing the bill for costly legal challenges. Colorado’s Taxpayer Bill of Rights (TABOR), which was approved by voters in 1992, requires voter approval to raise taxes.
Just because SB 215 cleverly calls the proposed health insurances taxes “fees” does not mean it is true. SB 215 seems to be a clear violation of TABOR.
The people of Colorado are already struggling enough from the forced shut down to stop the spread of the virus. The last thing they need right now is a new tax on their health insurance premiums.