Curbelo, González-Colón, Murphy introduce legislation to exempt Puerto Rico from Health Insurance Tax

Representatives Carlos Curbelo (R) of Florida, Jenniffer González-Colón (NPP,R) of Puerto Rico, and Stephanie Murphy (D) of Florida introduced bipartisan legislation to provide relief from the burdensome health insurance tax (HIT) to Puerto Ricans recovering from Hurricanes Irma and Maria.

The legislation, HR 4619, would amend the Affordable Care Act’s (ACA) Section 9010 by providing temporary relief to health insurance providers in Puerto Rico from paying the tax, which has been passed on to consumers in the forms of higher premiums. Since residents of the territories are ineligible to use the ACA marketplaces to obtain insurance, they’re paying for something they do not have access to.

“Most of the Affordable Care Act doesn’t impact Puerto Rico, but the Health Insurance Tax is one of a small number of provisions that does, and it’s hurting families in Puerto Rico who are trying to recover from Hurricanes Irma and Maria,” Curbelo said. “American citizens in Puerto Rico are subject to the burdens of the Affordable Care Act, but they do not have access to the benefits.  While I believe that the HIT functions as a tax that drives up the costs for all Americans, Puerto Ricans are especially burdened by the tax given the way the ACA uniquely treats the island.”

“This bill puts an end to the imposition of the HIT on insurers resulting from the Affordable Care Act, which at the end of the road, is borne by the insured through the increase in premiums. In the case of Puerto Rico, the HIT has had the effect of increasing premiums by 2% and of further annual increases. The big problem is that this tax was meant to be used for the health insurance exchange, as well as to provide credits and subsidies for other programs for which the Island does not qualify or benefit from; nonetheless, we have to pay the tax,” said González-Colón. “Therefore, the filing of this bill will result in the reduction of health insurance premiums paid in the Island, and reduction in costs of more than $ 200 million per year. I trust that Congress can promptly address this bill that would exempt health insurance in Puerto Rico from this tax which it does not provide the island with any benefit. The estimated HIT that would correspond to Puerto Rico in 2016 is $202 million and for 2017 is $ 249 million.”

“American citizens in Puerto Rico are treated unfairly under the Affordable Care Act due to the island’s status as a US territory. Patients on the island are paying for the Affordable Care Act’s health insurance tax, but do not benefit from many of the ACA provisions that this tax was designed to pay for. I am proud to help lead this bipartisan effort to repeal this tax in order to help our fellow Americans in Puerto Rico, whose longstanding challenges have worsened as a result of Hurricane Maria,” said Murphy.

Curbelo previously introduced a similar version of the bill earlier this year and last Congress to permanently exempt all US territories from the Health Insurance Tax.