Study: Senate Health Bill’s 14 Obamacare Tax Cuts Save Americans More than $337 Billion

Craig Bannister
By Craig Bannister | July 14, 2017 | 10:49 AM EDT

Bill cuts Obamacare taxes, saving Americans billions.

The new Senate health care bill saves Americans from more than $337 billion of Obamacare taxes, analysis by Americans for Tax Reform (ATR) reveals.

A study by ATR’s John Kartch lists 14 ways the Senate health bill abolishes or reduces Obamacare taxes:

  1. Obamacare Individual Mandate Tax which hits 8 million Americans each year. 
  2. Obamacare Employer Mandate Tax.
  3. Medicine Cabinet Tax, which hits 20 million Americans with Health Savings Accounts and 30 million Americans with Flexible Spending Accounts. This is a $5.6 billion tax cut.
  4. Obamacare's Flexible Spending Account tax on 30 million Americans. This is an $18.6 billion tax cut.
  5. Chronic Care Tax on 10 million Americans with high out of pocket medical expenses. This is a $36 billion tax cut.
  6. Health insurance tax. This is a $144.7 billion tax cut.
  7. Medical device tax. This is a $19.6 billion tax cut.
  8. Tax on prescription medicine. This is a $25.7 billion tax cut.
  9. Medicare Part D tax on retiree prescription drug coverage. This is a $1.8 billion tax cut.
  10. HSA withdrawal tax. This is a $100 million tax cut.
  11. 10% excise tax on small businesses with indoor tanning services. This is a $600 million tax cut.
  12. Delays (until 2026) the "Cadillac" tax on employer-provided insurance. This saves taxpayers $66 billion over the next ten years.
  13. Doubles the maximum HSA contribution from $3,400 to $6,550 for individuals and from $6,750 to $13,100 for families. According to CBO, this saves taxpayers $18.6 billion.
  14. Allows Americans to use Health Savings Account funds to pay for health insurance premiums. The option to use HSA funds, which are pre-tax, for insurance premiums will provide significant tax relief to millions of households. The CBO has not yet released a score for this tax cut. It is set to go into effect in 2018.

But, ATR President Grover Norquist says the new Senate health bill doesn’t go far enough – it should eliminate all Obamacare taxes - just as the original Senate bill did:

“All Obamacare taxes should be repealed. The Trump tax reform plan, the House health bill, and the original Senate health bill abolished the Obamacare 3.8% Net Investment Income Tax.

“Given the most recent language leaves some of the taxes in place, it is important for Senate Leadership to make it clear that those taxes will be abolished in tax reform this year.”

The original bill, released last month, saved taxpayers $701 billion in Obamcare taxes, ATR estimates.

See full, detailed ATR analysis here.