GOP lawmakers seek repeal of ‘belly-button tax’

Rule that exempts some groups from tax doesn’t go far enough, they say.

A new rule exempting some groups from a $63 tax on each person covered in a self-insured health plan doesn’t go far enough, said Columbus area Republican Rep. Pat Tiberi, who introduced a bill last month to repeal the tax altogether.

Under President Obama’s 2010 health care law, the administration created a new, three-year levy aimed at helping pay for new insurance consumers with costly medical conditions.

The tax was imposed on self-insured health plans, such as the ones large employers offer their employees. It was nicknamed the “belly-button tax” because it was imposed on each “belly button” covered through such plans, such as dependents of the employee.

But earlier this week, the administration released a rule exempting some self-insured, self-administered health care plans from the tax for 2015 and 2016. A proposed rule published by the Department of Health and Human Services in the Federal Register said that the levy was only intended to apply to those who used a third party to administer insurance, not those who “self-administered” insurance.

The argument, said one proponent of the rule, was that insurance companies who paid the $63 fee would ultimately reap a financial benefit by gaining new customers.

Last month, Tiberi, a senior member of the House Ways and Means Committee, and Rep. Daniel Lipinski, D-Ill., introduced a bill to repeal the tax. Rep. Mike Turner, R-Dayton, signed on as a co-sponsor.

Tiberi said the tax is patently unfair and “another incentive for employees to say ‘the heck with this.’”

The rule is up for comment until 5 p.m. on Dec. 26.

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