HICA Tax "Doomed" in Lame Duck; Lawmakers to Try Again in 2013

November 30, 2012

Friday, Nov. 30, 2012 - Earlier this week, we alerted you to the fact that lawmakers were planning to consider a bill to dramatically increase the Health Insurance Claims Tax (otherwise known as "HICA") on Michigan job providers. Thanks to your efforts, we were successful in our efforts to halt this job-killing tax - for now.

Although even the sponsor of the bill, Senate Bill 1359 (Senator Kahn, R-Saginaw), has declared the bill "doomed" during the Lame Duck session, the problem it proposed to solve remains real. The HICA tax is used to meet federal match requirements to fund Michigan's Medicaid program but has come in far short of expectations; meaning, shy of a solution, Medicaid provider cuts would be triggered.

Lawmakers are committed to finding a solution to the funding shortfall, so we fully expect the HICA debate to return in early 2013. We will continue to advocate that any increase in this tax will negatively impact the ability of employers to offer health insurance coverage to their employees and urge lawmakers to look for other viable funding solutions.

Thank you, again, for voicing your opposition to efforts to raise the HICA tax at the eleventh hour. Please continue to take every opportunity to make your voice heard on this job-killing tax so we can put this ill-conceived idea to rest, once and for all, in 2013.

Please contact Wendy Block or Tricia Kinley via email or phone at (517) 371-2100 if you have any questions.