Sec. 12-202a. Tax on net direct subscriber charges of health care centers. Exceptions.

(a) Each health care center, as defined in section 38a-175, that is governed by sections 38a-175 to 38a-194, inclusive, shall pay a tax to the Commissioner of Revenue Services for the calendar year commencing January 1, 1995, and annually thereafter on the total net direct subscriber charges received by such health care center during each such calendar year on any new or renewal contract or policy approved by the Insurance Commissioner under section 38a-183. The rate of tax on the total net direct subscriber charges received (1) prior to January 1, 2018, shall be one and three-quarters per cent, and (2) on or after January 1, 2018, shall be one and one-half per cent. Such payment shall be in addition to any other payment required under section 38a-48.

(b) Notwithstanding the provisions of subsection (a) of this section, the tax shall not apply to:

(1) Any new or renewal contract or policy entered into with the state on or after July 1, 1997, to provide health care coverage to state employees, retirees and their dependents;

(2) Any subscriber charges received from the federal government to provide coverage for Medicare patients;

(3) Any subscriber charges received under a contract or policy entered into with the state to provide health care coverage to Medicaid recipients which charges are attributable to a period on or after January 1, 1998;

(4) Any new or renewal contract or policy entered into with the state on or after April 1, 1998, to provide health care coverage to eligible beneficiaries under the HUSKY Health program, or HUSKY Plus program, each as defined in section 17b-290;

(5) Any new or renewal contract or policy entered into with the state on or after February 1, 2000, to provide health care coverage to retired teachers, spouses or surviving spouses covered by plans offered by the state teachers' retirement system;

(6) Any new or renewal contract or policy entered into on or after July 1, 2001, to provide health care coverage to employees of a municipality and their dependents under a plan procured pursuant to section 5-259;

(7) Any new or renewal contract or policy entered into on or after July 1, 2001, to provide health care coverage to employees of nonprofit organizations and their dependents under a plan procured pursuant to section 5-259;

(8) Any new or renewal contract or policy entered into on or after July 1, 2003, to provide health care coverage to individuals eligible for a health coverage tax credit and their dependents under a plan procured pursuant to section 5-259;

(9) Any new or renewal contract or policy entered into on or after July 1, 2005, to provide health care coverage to employees of community action agencies and their dependents under a plan procured pursuant to section 5-259; or

(10) Any new or renewal contract or policy entered into on or after July 1, 2005, to provide health care coverage to retired members and their dependents under a plan procured pursuant to section 5-259.

(c) The provisions of this chapter pertaining to the filing of returns, declarations, installment payments, assessments and collection of taxes, penalties, administrative hearings and appeals imposed on domestic insurance companies shall apply with respect to the charge imposed under this section.

(May Sp. Sess. P.A. 94-4, S. 49, 85; P.A. 95-160, S. 64, 69; June 18 Sp. Sess. P.A. 97-11, S. 57, 65; P.A. 98-110, S. 25, 27; P.A. 00-174, S. 78, 83; P.A. 01-30, S. 3, 4; June 30 Sp. Sess. P.A. 03-6, S. 65; P.A. 04-218, S. 14; P.A. 05-238, S. 2; P.A. 10-179, S. 47; June Sp. Sess. P.A. 10-1, S. 34; P.A. 11-25, S. 1; 11-44, S. 123; P.A. 15-69, S. 5; P.A. 17-198, S. 13; June Sp. Sess. P.A. 17-2, S. 623.)

History: May Sp. Sess. P.A. 94-4, S. 49, effective January 1, 1995, and applicable to premiums due on or after said date; P.A. 95-160 revised effective date of May Sp. Sess. P.A. 94-4 but without affecting this section; June 18 Sp. Sess. P.A. 97-11 exempted new or renewal contracts and policies with the state on or after July 1, 1997, to provide health care coverage to state employees, retirees and their dependents, and exempted subscriber charges received from the federal government for Medicare patients, effective July 1, 1997; P.A. 98-110 divided the section into Subsecs. (a) to (c), inclusive, and added new Subdivs. (3) and (4) to Subsec. (b) to exempt state contracts under Sec. 17b-28, Husky Plan contracts and state-administered general assistance, effective May 19, 1998; P.A. 00-174 added Subsec. (b)(6) re an exemption for policies entered into with the state providing coverage to retired teachers and by making technical changes for accuracy of reference, effective May 26, 2000; P.A. 01-30 added Subsec. (b)(7) and (8) to exempt contracts or policies procured under Sec. 5-259 that cover employees of municipalities or nonprofit organizations, effective July 1, 2001; June 30 Sp. Sess. P.A. 03-6 added Subsec. (b)(9) re new or renewal contracts or policies entered into on or after July 1, 2003, for coverage of health coverage tax credit eligible individuals, effective August 20, 2003; P.A. 04-218 amended Subsec. (a) to specify applicability of section to centers governed by Secs. 38a-175 to 38a-192, inclusive, and to specify that the tax applies to charges approved by the Insurance Commissioner, effective June 8, 2004, and applicable to income years commencing on or after January 1, 2005; P.A. 05-238 made technical changes in Subsec. (b), amended Subsec. (b)(7) to include dependents, added Subsec. (b)(10) and (11) re employees of community action agencies and their dependents and re retired members and their dependents, effective July 1, 2005, and applicable to income years commencing on or after January 1, 2005; P.A. 10-179 amended Subsec. (b)(3) by deleting reference to Medicaid managed care program and amended Subsec. (b)(4) by deleting references to Medicaid and HUSKY Plus programs, effective July 1, 2010; June Sp. Sess. P.A. 10-1 added reference to HUSKY Plus programs in Subsec. (b)(4), effective July 1, 2010; P.A. 11-25 made technical changes in Subsec. (b)(4); P.A. 11-44 amended Subsec. (b) by deleting former Subdiv. (5) re contracts to provide health care coverage to recipients of state-administered general assistance and redesignated existing Subdivs. (6) to (11) as Subdivs. (5) to (10), effective July 1, 2011; P.A. 15-69 amended Subsec. (b)(4) to change “HUSKY Plan, Part A, HUSKY Plan, Part B” to “HUSKY Health program” and “HUSKY Plus programs” to “HUSKY Plus program”, effective June 19, 2015; P.A. 17-198 amended Subsec. (a) by replacing reference to Sec. 38a-192 with reference to Sec. 38a-194, effective July 1, 2017; June Sp. Sess. P.A. 17-2 amended Subsec. (a) to decrease rate of tax on net direct subscriber charges received on or after January 1, 2018, from 1.75 per cent to 1.5 per cent and to make conforming changes, effective October 31, 2017.