Bill Continues Michigan Health Insurance Tax Until 2025

LANSING (AP) - Michigan's tax on health insurance would be continued until 2025 under legislation scheduled for a vote in the Legislature.

The Senate plans to vote on Tuesday on extending the 0.75 percent health insurance claims assessment, which helps pay for Medicaid coverage for low-income residents. The tax will go away in two years if legislation is not enacted.

The Michigan Chamber of Commerce calls the bill a "giant tax hike" to pay for "social welfare programs." But supporters say the measure already approved by the House gives certainty to businesses and funds vital health insurance for the poor.

If the tax is not extended, Medicaid spending could be cut by roughly $1 billion annually starting in the 2017-18 budget year unless another source of funding is used.

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