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New York’s Skyrocketing Taxes on Health Care

New York is bracing for a second wave of COVID-19 following the Thanksgiving holiday, and health insurance coverage for related testing and care is crucial. Meanwhile, individuals are quietly being taxed for that coverage.

New York State imposes several taxes on employers and individuals who buy private health insurance coverage. These taxes are paid by consumers and included in their premiums.

An annual report by the New York State Conference of Blue Cross and Blue Shield Plans reveals these taxes amounted to an estimated $5.57 billion in 2020 and increase premiums by between 6-9%.

“As we continue the battle against COVID-19, access to affordable health coverage is more critical than ever. New Yorkers should not be burdened with increasing premiums as a result of higher state taxes. As New York State leaders consider options to close the growing deficit due to the pandemic, they should avoid measures that will impact the cost of care.” – Leanne Politi, Executive Director of Communications for NYSCOP

Taxes on private health insurance ($5.57 billion) rank third highest in New York State, just after personal income taxes ($49 billion) and sales taxes ($12 billion). Also, among all business taxes levied by the state, the taxes imposed on the privately insured rank as the single largest tax.

Our report shows the four types of taxes that are driving up the cost of coverage for New Yorker’s – taxes often hidden as fees and surcharges.

View the full report here.