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Health Insurance Provider Fee

Health Insurance Provider Fee

The Affordable Care Act imposes an annual, non-tax deductible fee on all fully insured health plans, with some exceptions. Entities that are exempt from the annual fee include:

  • Plans with net premiums of $50 million or less
  • Employer and governmental entities
  • Nonprofits receiving more than 80 percent of their gross revenues from government programs

Health insurance plans exempt under IRS code sections 501(c)(3), (4), (26) and (29) will have 50 percent of net premiums written included for the purposes of determining their market share.

The annual health insurance provider fee will be allocated across the health insurance industry based on premium revenues.

The tax will start at $8 billion in 2014, increasing to $14.3 billion in 2018, and will continue to increase each year.

Fee amounts will be based on the following:Health Insurance Provider Fee