II 

115TH CONGRESS 

1ST SESSION S. 58 

To amend the Internal Revenue Code of 1986 to repeal the excise tax 

on high cost employer-sponsored health coverage. 

IN THE SENATE OF THE UNITED STATES 

JANUARY 9, 2017 

Mr. HELLER (for himself and Mr. HEINRICH) introduced the following bill; 

which was read twice and referred to the Committee on Finance 

A BILL 

To amend the Internal Revenue Code of 1986 to repeal 

the excise tax on high cost employer-sponsored health 

coverage. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Middle Class Health 

5 Benefits Tax Repeal Act of 2017’’. 

6 SEC. 2. REPEAL OF EXCISE TAX ON HIGH COST EMPLOYER7 SPONSORED HEALTH COVERAGE. 

8 (a) IN GENERAL.—Chapter 43 of the Internal Rev9 enue Code of 1986 is amended by striking section 4980I. 


srobinson on DSK5SPTVN1PROD with BILLS
2 

•S 58 IS

1 (b) CONFORMING AMENDMENT.—Section 6051 of 

2 such Code is amended— 

3 (1) in paragraph (14) of subsection (a), by 

4 striking ‘‘section 4980I(d)(1)’’ and inserting ‘‘sub5 section (g)’’, and 

6 (2) by adding at the end the following: 

7 ‘‘(g) APPLICABLE EMPLOYER-SPONSORED COV8 ERAGE.—For purposes of subsection (a)(14)— 

9 ‘‘(1) IN GENERAL.—The term ‘applicable em10 ployer-sponsored coverage’ means, with respect to 

11 any employee, coverage under any group health plan 

12 made available to the employee by an employer 

13 which is excludable from the employee’s gross in14 come under section 106, or would be so excludable 

15 if it were employer-provided coverage (within the 

16 meaning of such section 106). 

17 ‘‘(2) EXCEPTIONS.—The term ‘applicable em18 ployer-sponsored coverage’ shall not include— 

19 ‘‘(A) any coverage (whether through insur20 ance or otherwise) described in section 

21 9832(c)(1) (other than subparagraph (G) there22 of) or for long-term care, or 

23 ‘‘(B) any coverage under a separate policy, 

24 certificate, or contract of insurance which pro25 vides benefits substantially all of which are for 


srobinson on DSK5SPTVN1PROD with BILLS
3 

•S 58 IS

1 treatment of the mouth (including any organ or 

2 structure within the mouth) or for treatment of 

3 the eye, or 

4 ‘‘(C) any coverage described in section 

5 9832(c)(3) the payment for which is not exclud6 able from gross income and for which a deduc7 tion under section 162(l) is not allowable. 

8 ‘‘(3) COVERAGE INCLUDES EMPLOYEE PAID

9 PORTION.—Coverage shall be treated as applicable 

10 employer-sponsored coverage without regard to 

11 whether the employer or employee pays for the cov12 erage. 

13 ‘‘(4) GOVERNMENTAL PLANS INCLUDED.—Ap14 plicable employer-sponsored coverage shall include 

15 coverage under any group health plan established 

16 and maintained primarily for its civilian employees 

17 by the Government of the United States, by the gov18 ernment of any State or political subdivision thereof, 

19 or by any agency or instrumentality of any such gov20 ernment. 

21 ‘‘(5) COST OF COVERAGE.— 

22 ‘‘(A) HEALTH FSAS.—In the case of appli23 cable employer-sponsored coverage consisting of 

24 coverage under a flexible spending arrangement 

25 (as defined in section 106(c)(2)), the cost of the 


srobinson on DSK5SPTVN1PROD with BILLS
4 

•S 58 IS

1 coverage shall be equal to the amount deter2 mined under rules similar to the rules of section 

3 4980B(f)(4) with respect to any reimbursement 

4 under the arrangement reduced by the contribu5 tions described in subsection (a)(14)(B). 

6 ‘‘(B) ARCHER MSAS AND HSAS.—In the 

7 case of applicable employer-sponsored coverage 

8 consisting of coverage under an arrangement 

9 under which the employer makes contributions 

10 described in subsection (b) or (d) of section 

11 106, the cost of the coverage shall be equal to 

12 the amount of employer contributions under the 

13 arrangement. 

14 ‘‘(C) ALLOCATION ON A MONTHLY

15 BASIS.—If cost is determined on other than a 

16 monthly basis, the cost shall be allocated to 

17 months in a taxable period on such basis as the 

18 Secretary may prescribe.’’. 

19 (c) CLERICAL AMENDMENT.—The table of sections 

20 for chapter 43 of such Code is amended by striking the 

21 item relating to section 4980I. 

22 (d) EFFECTIVE DATE.—The amendments made by 

23 this section shall apply to taxable years beginning after 

24 December 31, 2017. 

Æ 


srobinson on DSK5SPTVN1PROD with BILLS