WASHINGTON, D.C. | September 18, 2013
Dear Secretary Perez and Director Burwell:
We respectfully request clarification regarding the Obama administration’s regulatory efforts related to Taft-Hartley health insurance plans (Taft-Hartley plans) and the Patient Protection and Affordable Care Act (PPACA). Although we appreciate the confirmation provided by the Department of the Treasury that an individual cannot benefit from employer-provided health coverage and a premium tax credit, we remain concerned the administration is considering regulations to allow millions of individuals in Taft-Hartley plans to receive preferential treatment not available to other Americans who have employer-provided health insurance, contradicting the intent of the law.
As recently confirmed by Treasury, the statutory language of PPACA is clear: individuals enrolled in a Taft-Hartley plan are not eligible for taxpayer subsidies. Individuals who are eligible for “minimum essential coverage,” including employer-sponsored plans, are not eligible for premium tax credits. The statute unmistakably limits individuals eligible for premium tax credits to those who are not offered health insurance coverage through an employer.
To that end, on August 26, 2013, Treasury issued a final rule addressing compliance with the individual mandate. The Treasury rule stated, “[t]he final regulations are revised to provide that a plan offered by an employer to an employee includes a plan offered to an employee on behalf of an employer.” In short, an employee who receives health insurance coverage through a Taft-Hartley plan is considered to have employer coverage.
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To read a follow-up letter from the committee, click here.