Press Release

Partnership for Employer-Sponsored Coverage Opposes Efforts to Tax Employees on the Value of Their Health Coverage

Issued by Partnership for Employer-Sponsored Coverage [P4ESC]

July 17, 2024

WASHINGTON – The Partnership for Employer-Sponsored Coverage (P4ESC) today underlined opposition to proposals made by the Paragon Health Institute and others to cap the individual income tax exclusion for employer-sponsored coverage.

“The Paragon Health Institute plan to cap the exclusion fails to solve its stated goal: lowering health care costs,” said Neil Trautwein, P4ESC’s Executive Director. “Instead, it will increase employees’ tax burden by recognizing health coverage as additional individual income for tax purposes. Ultimately it will disrupt employer-based coverage – our nation’s single largest source of coverage – entirely. Capping the tax exclusion will lead inevitably to Medicare-for-All and other national health care schemes. It is a bad bargain and a worse policy path to consider.”

P4ESC Chair Melissa Bartlett, Senior Vice President of Health Policy, The ERISA Industry Committee (ERIC), added, "Capping employer-sponsored coverage is a flawed solution that fails to address the real drivers of health care costs. Such caps could force employers to hike premiums or slash benefits, hurting millions of families. Instead of disrupting coverage, Congress should tackle the root causes of soaring health care expenses."  

About The ERISA Industry Committee: ERIC is a national advocacy organization that exclusively represents large employers that provide health, retirement, paid leave, and other benefits to their nationwide workforces. With member companies that are leaders in every sector of the economy, ERIC advocates on the federal, state, and local levels for policies that promote flexibility and uniformity in the administration of their employee benefit plans. Learn more at eric.org.

About the Partnership for Employer-Sponsored Coverage (P4ESC): P4ESC is a nonpartisan advocacy alliance of employment-based organizations and trade associations representing businesses of all sizes and sectors, and the millions of Americans and their families who rely on employer-sponsored coverage every day. Employer-sponsored health insurance is the single largest source of coverage in our nation. https://www.p4esc.org

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