Cadillac Tax: Congress Is Split On Reform Effort To Tax Costly Health Care Plans

New York Times:

A proposed tax on high-cost, or "Cadillac," health insurance plans has touched off a fierce clash between the Senate and the House as they wrestle over how to pay for legislation that would provide health benefits to millions of uninsured Americans.

Read the whole story: New York Times

Comments

[Norm]

$8,000 per single person is hardly a "Cadillac plan." For a single person in their late fifties, that would be a heck of a bargain. Apparently, there are some in Congress who have yet to grasp how insurance works in the real world. First off, as a single mother with a child, my family was a two people family but always paid the same health insurance rate as an eight person family. Second, as a single parent with a sick child, I looked for jobs with good benefits - or "Cadillac plans." These often turned out to be lower paying state jobs. "Cadillac plans" have affordable deductibles. If you have insurance, inability to afford deductibles or prescription copays is the same as having no insurance.

Taxing "Cadillac plans" will not just encourage employers will stop providing them, but may also have the unintended consequence of forcing some parents out of the labor force - so they can receive Medicaid.

[mrskorn]

I hope that all the legislators in DC will be included in this tax. As well as the president, vice president, Pelosi etc. They all get the best health care (for life, don't they?) so they can help pay as well.

[cheeriogirl]

So they intend to lower our overall costs for health care, by increasing our taxes for the benefits we ultimately receive. But if we are willing to take less benefits, then we are not taxed?

What a plan! This is nothing but an early Christmas gift to the wealthy, and the insurance industry.

What happened to the plan to raise taxes on the top 1%?

PLEASE CALL YOUR CONGRESSMAN TODAY, and ask them to vote AGAINST this ridiculous plan, that will NOT benefit our middle class.

[mtracy9]

I just signed a petition demanding that the U.S. Congress allow a public option.

Click here to sign: http://bit.ly/1MOpFS

[econ1]

The money has to come from somewhere and taxing the Cadillac plans makes sense because it will encourage people to look at the expense (which they don't now because it is "free"). This encourage cost cutting.

[Patriot86]

No because this taxes middle income people while allowing the rich as usual to skate. Pass a tax hike for those making more then 250,000 as promised.

[econ1]

The plans already include that, but there are not enough of them to pay the full cost, so there have to be additional sources of funds.

[cyoohoos]

Actually, it doesn't make sense. In the long run, that tax will make people drop the 'Cadillac' plans which will dry up the revenue to pay for this.

What they SHOULD do is get a national sales tax. Everyone, even illegal immigrants who like it or not will still get care via emergency rooms, will have to pay into the system to support this.

[lvdragonlady]

Why pay at all? Force the insurance companies to pick up the tab. They are the problem MAKE them be part of the solution.

[Disdain]

When you "force" them to pick up the tab, where do you think they are going to get the money? They'll simply raise their premiums! You will end up paying for it anyway.

[getsit]

I had a Cadillac plan until the current year when our benefits were cut. We still have ok benefits but pay more.

People have the wrong idea that only high paying executives have these plans. It also applies to union workers, and government workers. I certainly don't make a whole lot of money (I wish) and have trouble making ends meet even though I am thrifty. I partially pay out of my check for my health benefits.

My objection is that other plans cost so much in deductibles/copays, that they are close to being worthless for most of us. These are the plans the health insurance companies want us to have because we will be paying high premiums, copays, and deductibles with no return on our money if we are well and bankrupt if we get sick. It means guaranteed high profits for the health insurance industry with few benefits having to be paid. IT'S NUTS!

I cannot believe Congress would consider a "choice" since most people will chose the plans they can "afford". These will be costly, poor benefit plans which will cost the government more.

I guess the idea is that we will be more "careful"about using our health plan since it will cost us more every time we do. Isn't that the problem now? People under insured? Not going to the doctor for preventative care because we can't afford it? Delaying care raises the cost of care for everyone, EXCEPT the insurance companies?

[roudy]

It is apparent that this proposed tax does nothing t reduce overall health care for either the individual or the country. All it does is shift the cost of the health care more to the individual, who in many cases cannot afford it now.

Nothing but another give away to the insurance companies, shifting the increasing cost to the individual and more money in the companies coffers.

[apolloguide]

How about a cardiac tax on junk food?

[booker52]

The idea of taxing benefits is wrong.All that will happen is employees will get less coverage and that tax will be passed on to them.

[FoonTheElder]

This is a tax that will eventually fall on average workers in high health cost states. Especially now that most health care reform plans have given health insurance companies carte-blanche to increase premiums as they see fit.

The real Cadillac plans are held by big corporations on the executives, which cover anything that you could imaging and cost $25-$30,000 per year or more. The Time article below talks about the CEO of Goldman Sachs getting $40,000 a year in health benefits.

An example at: http://www.emaxhealth.com/72/11368.html http://www.time.com/time/politics/article/0,8599,1913147,00.html http://atlanta.bizjournals.com/atlanta/stories/2006/07/03/smallb4.html

Read more at: http://www.huffingtonpost.com/2009/10/13/cadillac-tax-congress-is-_n_318191.html

[enochsmoky]

How serious are the Democrats about enacting health insurance reform if they cannot stand up to the unions concerning taxing overly generous health benefits or stand up to the trial attorneys over tort reform? There are no "Profiles in Courage" on Capitol Hill.

[getsit]

What makes it "over generous"? That it covers you for your health? That it will keep you from going bankrupt if you are sick? That it covers your preventative care to catch illnesses early which will cost less (or you die like the insurance companies would like you to do while you appeal denials)?

Have you ever been, or a family member been, seriously long term sick or injured? Don't you want to be covered? There is no guarantee, for even the healthiest person, that this will never happen to them. Are you looking forward to bankruptcy?

Do you realize that if we had single payer what a boon it would be for most businesses big and small? Wouldn't you like more businesses to locate in the USA because their operating expenses will be lower? Wouldn't you like more jobs created?

[Patriot86]

Listen the middle class would be hurt by this tax. Why don't you go join all the other union haters on the far right sites...Unions no longer have gold plated benefits-oh they cost plenty but cover little. The health insurance industry has screwed over every living person in America. Any Dem that wants to raise taxes on the middle class instead of the oh so deserving rich should be driven from office. Raise taxes on the wealthy. For too long they have enjoyed the fruits of this country while not paying their fair share...crack down on off shoring also.

[wimisy]

My husband is a union member and he pays almost 800.00 A MONTH for just the 2 of us. He pays the same amount as someone with 6-8 children. And he cannot opt out. So while it appears "generous" to you he pays through the nose for it.

[commentator101]

Dems failure so far to clearly support this tax undermines their credibility on this issue. Keep in mind that this isn't really a new tax at all, it's just addressing the fact that since employer provided health care is an untaxed benefit, people who receive Cadillac plans are getting more tax-free income than the rest of us.

[Patriot86]

What about the premiums we pay for our insurance and deductibles...you merely want the dems to this so they can be driven from office in 2010 deservedly if they tax health care plans.

[martiniandabotoxchaser]

Unions and public employees have some of the most benefit rich insurance plans in the nation. The Democratic Congress is not going to do anything that is going to affect the coming midterm elections. Ultimately we are going to end up national health. We can't have insurance that discriminates between workers of large employers, small employers, union members and the millions of uninsured. The big questions are how to pay for a national plan and what should be covered. There will be losers and there will be winners. Those who receive the greatest benefits, including seniors, will lose. The uninsured will win. Those in the middle...well that is what remains to be sorted.

[timberdoodle]

A single payer system like Medicare for all and everyone wins. All modern societies do it so why not America?

[martiniandabotoxchaser]

Single payer works only if the government has the guts to deny and limit benefits as is done in other nations and is willing to cap the back of the phone book lawyers. Medicare is falling apart because the benefits are too rich. Everyone can't get the latest and greatest or we will go bankrupt. In counties like Britain and Canada people are denied access to certain procedures after a certain age. For a single payer to work there has to be a bigger emphasis put on prevention and penalties for doing things that cost all of us money such as smoking and obesity. That one will never fly with Republicans.

[jcwtts1]

Teachers, I grew up in an education household that had what hospitals called the President's insurance. We had access to everything, cheap, low co-pay or non existent co pay. My mom got sick and her treatment was spectacular. Completely insanely spectacular. Taxing these plans shift the burden too much towards working middle class people. The majority of people who will be effected by this tax are the same people who were left out of the tax windfall of the last 8 years. The bush tax cuts were weighted, heavily, towards the wealthiest people in the country, so too should the new tax increase be weighted towards them. For every CEO you nail with this tax you will nail 100 teachers.
Bad idea.

J

[Protea32]

I'm a unionized public employee. We've been told to get ready for this possibility.

[Patriot86]

Wrong, banker have the best plans these days. The UAW for example pays for five doctor visits a year period for the entire family. They pay only 80 percent after a large deductible has been met. My neighbor has this insurance. It sucks. The Wall Street boys and girls will evade this tax and rake in more money no way.

[martiniandabotoxchaser]

This is far from true. If a person is sick they get to go to a doctor with UAW insurance. There may be a limit on well checks but not on those related to illness.

[timberdoodle]

Sometimes it's difficult to understand the American logic when it comes to taxes.

Taxes are a necessary evil that enable the government to have the funds to provide the necessities of life for their citizens on a whole host of needs that a single individual simply couldn't afford to pay for on their own every time they had to use one of these services.

If an employer pays for an employee's health insurance benefit the employee should pay income tax on these benefits being received as it is income plain and simple. Paying a small percentage of the health insurance costs as taxes is sure a lot better than paying for the full cost of the coverage.

Right now the lion's share of everyone's taxes goes to the military and their corporate cronies and the majority of Americans seem to accept this or even endorse it as being more important than saving 45,000 American lives a year with universal health care. SIMPLY AMAZING!

[Capibara]

"Paying a small percentage of the health insurance costs as taxes is sure a lot better than paying for the full cost of the coverage."

If everyone pays a small percentage WHO pays the rest? Duh

Sounds like you stand to benefit from any proposed plan, if you are paying anything less than every penny of your own health care costs.