Billions of dollars in hidden state taxes are driving up the cost of health insurance for New York consumers and employers, according to a report published today by the Empire Center.

The taxes, collected under the state’s Health Care Reform Act, add approximately $440 per person to the annual cost of coverage, or $1,760 for a family four, according to estimates in the report by Bill Hammond, the Empire Center’s director of health policy.

The insurance levies are mostly collected through insurance premiums, making them invisible to average taxpayers. Yet they account for most of the $6 billion in revenue collected under HCRA, making it the state’s third largest source of revenue after income and sales taxes.

HCRA is up for renewal this year, raising concern that lawmakers will hike insurance surcharges to help close a $6 billion budget gap. Governor Cuomo has said his Medicaid Redesign Team, which is tasked with finding $2.5 billion in savings, may consider “additional industry revenue” as one of its options.

The proceeds from HCRA’s insurance surcharges were originally earmarked for specific purposes, such as financing free care for the uninsured. Today, three-quarters of the money flows into the larger budget for Medicaid, the state’s $75 billion health plan for the low-income and disabled.

Smaller portions are used for various health-related programs, many of which are focused more on the welfare of providers than patients.

“In the name of reform … New Yorkers struggling to afford health coverage are paying billions in regressive taxes to finance programs that do little to improve health care – and, in some cases, enable dysfunction,” Hammond writes.

The report, “Hooked on HCRA: New York’s 24-year health tax habit,” updates a study originally published in 2017.

The Empire Center, based in Albany, is an independent, non-partisan, not-for-profit think tank dedicated to promoting policies to make New York a better place to live, work and raise a family.

You may also like

Most Long Island Educators Paid at Least $100,000 Last Year

18% of all public-school teachers and administrators employed by school districts outside New York City were paid over $100,000 last year Read More

Newest Pensions for Retirees of Police and Fire Careers Average $86,852

ALBANY, NY - Newest Pensions for Career Police and Fire Retirees Average $86,852  Read More

Statement on the release of new COVID-19 Death Toll data

The Cuomo administration left out many people who died without a test during the early weeks of the pandemic Read More

An Open Letter to Lt. Gov. Kathy Hochul

As an organization committed to openness in government, we welcome your commitment to leading a fully transparent administration Read More

New Public Authority Payroll Data Now Posted at SeeThroughNY 

ALBANY, NY — 2020 for a total of 79,146 employees at 331 different New York State public authorities is now posted at , the Empire Center’s transparency website. 2021 is also posted for a total of 11,073 employees at 23 public aut Read More

Empire Center Announces Elizabeth Adadi as Communications and Marketing Manager

Elizabeth Adadi has recently joined the Empire Center for Public Policy as Communications and Marketing Manager Read More

Empire Center Appeals COVID FOIL Request Delays

Empire Center has appealed four delayed Freedom of Information Law requests pertaining to state COVID-19 data Read More

$139K Average Pension for New Full-Career FDNY Retirees

Nearly three-quarters of those retiring last year from the City of New York’s Fire Department (FDNY) were eligible for six-figure pensions Read More

Subscribe

Sign up to receive updates about Empire Center research, news and events in your email.

CONTACT INFORMATION

Empire Center for Public Policy
30 South Pearl St.
Suite 1210
Albany, NY 12207

Phone: 518-434-3100

General Inquiries: Info@EmpireCenter.org

Press Inquiries: Press@EmpireCenter.org

About

The Empire Center is an independent, non-partisan, non-profit think tank located in Albany, New York. Our mission is to make New York a better place to live and work by promoting public policy reforms grounded in free-market principles, personal responsibility, and the ideals of effective and accountable government.

Empire Center Logo Enjoying our work? Sign up for email alerts on our latest news and research.
Together, we can make New York a better place to live and work!