Postponed: Health Insurance Providers Fee

The continuing short-term spending resolution President Trump signed in late January has further postponed the health insurance providers fee for 2019 (although the fee continues to apply for 2018).

In 2014, the Affordable Care Act imposed an annual, nondeductible fee on the health insurance sector. The fee is treated like an excise tax and is required to be paid by September 30 of each calendar year. The first fees were due September 30, 2014.

The 2016 federal budget suspended collecting the providers fee for the 2017 calendar year, so health insurance issuers did not have to pay in 2017. The reprieve expired at the end of 2017.

The recently signed resolution provides an additional one-year delay for this fee for the 2019 calendar year. However, the continuing resolution specifically declines to extend the postponement through 2018. Therefore, the fee continues to apply for the 2018 calendar year.

Although employers themselves are not directly subject to the health insurance providers fee, many providers have passed the cost of the fee onto the employers. As a result, this one-year postponement may result in significant savings for some employers on their health insurance coverage rates.

For more information, download our bulletin or contact your NIS Representative.