The California Legislature is poised to pass a plan that would place a tax on healthcare plans, according to San Jose-Mercury News.
Here are five insights:
1. The tax would bring in $1.27 billion each year and would increase funding for the developmentally disabled Californians for the first time in more than 10 years.
2. If legislators approve the tax this week, it would replace the current tax of health plans that generates about $270 million less than the $1.27 billion. The existing tax is set to expire in July as it is not compliant with the Obama administration's new rules saying how states may levy those types of taxes.
3. Various payers and health plans have recently given endorsements for Gov. Jerry Brown's tax proposal. However, opponents of the tax claim it is a tax hike that will be passed on to consumers via higher premiums.
4. California's current management healthcare plans tax allocates $1 billion to Medi-Cal. Gov. Brown's proposed tax would use $250 million of the revenue raised to restore funding for the In-Home Supportive Services program.
5. The tax must receive a two-third vote in the state Senate and Assembly before Gov. Brown can sign off on it.
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