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For Release — March 18, 2009

Health care taxes could damage important industry according to The Business Council

ALBANY— “The $481 million in additional taxes on health insurers proposed in the Executive Budget will not only drive up the cost of health insurance, they will damage an industry that is important to the state's economy,” said Kenneth Adams, president & CEO of The Business Council of New York State.

“New York health insurers employ approximately 35,000 people across New York State. Increasing the cost of health insurance is likely to lead to more uninsured New Yorkers and less growth in this industry,” added Adams. “Driving up health insurance costs by adding taxes is simply the wrong direction for New York.”

“Make no mistake adding nearly a billion dollars in new taxes will drive up the cost of health insurance for employers and workers. For many this could be the tipping point that leads to a decision to drop coverage,” said Adams.

On top of the $348 million in new health insurance taxes that were passed as part of the Deficit Reduction Plan in February, the proposed budget calls for an additional $481 million in new taxes on this industry, including:

New Yorkers - individuals and businesses - that purchase private health insurance currently pay more than $3.75 billion in health taxes through the Covered Lives Assessment; the HCRA hospital services surcharge; the Insurance Department Section 332 industry-wide assessments that fund Department operations and are also sub-allocated to other agencies and programs; and the 1.75 percent premium tax. They simply cannot afford new taxes to be added on.

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