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Mass. among states hit hardest by ACA taxes, study suggests

A recent analysis of a new healthcare insurance tax contained in the Affordable Care Act will place a greater tax burden on residents of Massachusetts than those in many other states, one study suggests.

The report, announced Wednesday by America’s Health Insurance Plans, places Massachusetts as the 10th most affected state by the new tax — shouldering about $4 billion of additional taxes on citizens over the next 10 years.

“With full implementation of the ACA a year away, the focus needs to be on making coverage more affordable,” said AHIP President and CEO Karen Ignagni in a press release. “Taxing health insurance will have the opposite effect by making it more expensive.”

Massachusetts was also listed as a state that will see large tax-hikes for families purchasing insurance. The report, conducted by the Oliver Wyman consulting firm for AHIP, estimated Massachusetts families could see an increase of $9,937 in health care taxes over the next 10 years on the individual market, and a $8,555 increase of taxes through small employers.

The Affordable Care Act, more commonly known as Obamacare,   will also raise taxes in the Medicare and Medicaid market, according to the report.

Enrollees in Medicare nationwide are expected to pay $3,604 over 10 years, and Medicaid recipients are expected to pay $1,523 more over 10 years.

The Affordable Care Act has long been compared to the insurance overhaul undertaken under former Mass. Gov. Mitt Romney in 2006. The law established ambitious goals for health care reform, including subsidizing healthcare for the very poor and expanding coverage to the uninsured.

Pieces of legislation in both chambers of Congress aim to repeal these fees placed on insurance providers that translate into taxes. Both these bills, called H.R. 1370 and S. 1880 respectively, are still stalled in committees.

The Joint Committee on Taxation, a nonpartisan congressional committee, argued that if the fees are repealed, insurance plans would be less expensive.

“We estimate that repealing the health industry fee would reduce the premium price of plans offered by covered entities by 2.0 to 2.5 percent,” wrote Thomas Barthold in a letter from the commission to Congress in 2011.

The Congressional Budget Office has also voiced concern over the new costs with which the ACA would burden consumers.

The ACA, which has won support from a few Democratic Massachusetts politicians, allows people under the age of 26 to stay on their parents’ health care plan, mandates free preventive care and offers coverage to those with preexisting conditions, according to the federal government website

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