WASHINGTON, D.C., April 14, 2016—Sen. Martin Heinrich (D-New Mexico) addressed the Young Agents & InsurPac State Chairpersons Legislative Luncheon yesterday during the annual Big “I” Legislative Conference.
“I believe we shouldn’t be above taking risks to get bipartisan things done,” said Sen. Heinrich. “The ‘Cadillac’ tax is a perfect example of that.”
The ACA levies the “Cadillac” tax on health benefits that exceed an established annual cost. Originally slated to take effect in 2018, this tax would have impacted plans valued at $10,200 a year for individuals and $27,500 a year for families. However, the omnibus spending package Congress passed in December delayed the effective date of the tax for two years, until 2020.
According to a March survey by Mercer, a benefits consulting firm, about one-third of employers would have faced the tax in 2018 if they did nothing to change their plans. By 2022, almost 60% would have faced the levy. And Sen. Heinrich said successfully fighting it required first breaking down the barriers of partisan politics.
“It wouldn’t have happened if there weren’t people on both sides of the aisle that said, ‘This is worth doing,’” pointed out Sen. Heinrich, who praised Rep. Joe Courtney (D-Connecticut), for example, for first calling attention to the fact that it’s not actually a “Cadillac” tax at all—“Ford Focus” tax would be a more accurate label.
“It’s going to be touching people who are nowhere near an Escalade,” Sen. Heinrich explained. “It’s going to impact middle-class folks if this goes into effect.”
The Alliance to Fight the 40 predicts the tax would lead to a reduction in employer-sponsored coverage and an increase in employee cost sharing—the exact opposite of the ACA’s stated goals and a consequence that would harm many small businesses and middle-income Americans across the country.
“The ‘Cadillac’ tax really runs counter to what many of us wanted to see in health care reform, which is more focus on prevention and less on people getting services in an acute setting, like the emergency room,” Sen. Heinrich explained. “We all know that especially with inclusion of these prevention plans in that cap, that’s exactly the first thing that would go away.”
Throughout the process, Sen. Heinrich also worked closely with Sen. Dean Heller (R-Nevada)—a “pragmatist who actually believes in taking things home to his constituents,” Sen. Heinrich said.
But the final piece of the puzzle was the grassroots efforts of independent agents and others across the country. “Together, with us being able to push an amazingly diverse coalition, all of you made a difference in that effort,” Sen. Heinrich said. “We felt it on Capitol Hill. It’s easy to buy into this idea that things have become so polarized in this country that we can’t do anything, but that is a self-fulfilling prophecy. When small businesses speak, members of Congress listen.”
Because the tax’s consequences are so far-reaching, it wasn’t an easy issue to pigeonhole—and that broad support for its repeal or delay helped move the issue through Congress. Sen. Heinrich said, “It is the breadth of this coalition that gives me a great deal of optimism about what we’re going to ask of you in the future, which is to fully repeal the ‘Cadillac’ tax and end this excise tax once and for all.”
“The Big ‘I’ is proud to have such a strong relationship with Sen. Heinrich and was honored to have him address our Young Agent and InsurPac leaders,” says Charles E. Symington, Jr., Big “I” senior vice president for external and government affairs. “We will continue to work with him on the ‘Cadillac tax’ issue and other legislative efforts that impact small business and the independent agency system.”
Sen. Heinrich was elected to the U.S. Senate in 2012. He serves on the U.S. Congress Joint Economic Committee as well as the Senate Committees on Energy & Natural Resources, Armed Services, and Intelligence. Prior to being elected to the Senate, he served two terms in the U.S. House of Representatives. Before he was elected to Congress, Sen. Heinrich served four years as an Albuquerque City Councilor and was elected by his peers as City Council President. Sen. Heinrich earned a bachelor’s degree in mechanical engineering from the University of Missouri.
The event also featured the presentation of the annual InsurPac National Championship awards, Young Agent of the Year and Eagle awards.
Founded in 1896, the Big “I” is the nation’s oldest and largest national association of independent insurance agents and brokers, representing a network of approximately a quarter of a million agents, brokers and their employees nationally. Its members are businesses that offer customers a choice of policies from a variety of insurance companies. Independent agents and brokers offer all lines of insurance—property, casualty, life, health, employee benefit plans and retirement products. Web address: www.independentagent.com.