4 Comments

  1. “… Let’s give Congress the benefit of the doubt. It didn’t realize how the interaction of the various provisions of the ACA would affect Section 4980I’s Cadillac tax. …”

    NOPE. They may or may not have realized what they were doing, but, they probably just didn’t care.

    Find me a Senator who voted in favor of the legislation who actually read it all and understood it all. Pretty much impossible because, in the final seven days before the senate passed the bill on 12/24/09 at 7:05AM, we saw well in excess of 50 amendments and actions, so chances are that no Senator actually had a final copy of the bill in her/his hands more than a few hours before the vote.

    Your proposal won’t work if the Cadillac Tax is to fulfill its purpose – that health reform wouldn’t add one thin dime to the federal deficit or the national debt. So, intentionally, the tax must reach down below the platinum level if it is to generate the promised revenue. But, perhaps, no one cares about that anymore – so, perhaps your “solution” is as good as any other “solution”.

    Remember, the Cadillac Tax was just one more part of the legislation … designed to get the bill through cloture at the Senate… just like the “Cornhusker Kickback”, the “Louisiana Purchase”, the “Florida Flim Flam”, and other lesser known Senate frauds such as in Montana to expand Medicare to cover people exposed to asbestos from a Libby, Montana mine, expansion of Medicare payments to hospitals and doctors in Montana, North Dakota, South Dakota, Utah and Wyoming, added Medicaid funding for Vermont and Massachusetts, Medicare Advantage protections for retirees in New York and Pennsylvania, and money for health facilities/medical schools to garner votes.

    So, no excuses. Not surprisingly, many experts believe the Cadillac Tax is a prime candidate for repeal and replace in 2017 – so that to the extent it remains, to the extent coverage is scaled back or take home pay is reduced (if they cap the tax preference), it will be something congressmen and senators can attempt to blame on employers.

  2. “… Let’s give Congress the benefit of the doubt. It didn’t realize how the interaction of the various provisions of the ACA would affect Section 4980I’s Cadillac tax. …”

    NOPE. They may or may not have realized what they were doing, but, they probably just didn’t care.

    Find me a Senator who voted in favor of the legislation who actually read it all and understood it all. Pretty much impossible because, in the final seven days before the senate passed the bill on 12/24/09 at 7:05AM, we saw well in excess of 50 amendments and actions, so chances are that no Senator actually had a final copy of the bill in her/his hands more than a few hours before the vote.

    Your proposal won’t work if the Cadillac Tax is to fulfill its purpose – that health reform wouldn’t add one thin dime to the federal deficit or the national debt. So, intentionally, the tax must reach down below the platinum level if it is to generate the promised revenue. But, perhaps, no one cares about that anymore – so, perhaps your “solution” is as good as any other “solution”.

    Remember, the Cadillac Tax was just one more part of the legislation … designed to get the bill through cloture at the Senate… just like the “Cornhusker Kickback”, the “Louisiana Purchase”, the “Florida Flim Flam”, and other lesser known Senate frauds such as in Montana to expand Medicare to cover people exposed to asbestos from a Libby, Montana mine, expansion of Medicare payments to hospitals and doctors in Montana, North Dakota, South Dakota, Utah and Wyoming, added Medicaid funding for Vermont and Massachusetts, Medicare Advantage protections for retirees in New York and Pennsylvania, and money for health facilities/medical schools to garner votes.

    So, no excuses. Not surprisingly, many experts believe the Cadillac Tax is a prime candidate for repeal and replace in 2017 – so that to the extent it remains, to the extent coverage is scaled back or take home pay is reduced (if they cap the tax preference), it will be something congressmen and senators can attempt to blame on employers.

  3. Great idea – much simpler to administer and more fair. Longer term, though I think the tax exclusion for benefits should go away. There’s no moral or economic justification for it. If eliminated, some of the added tax revenue could be used for some blend of income and age-based tax credits to help pay for coverage. Everyone should be moved to the exchanges, with competitive exchanges available, jut just state and federal ones. Moving everyone to exchanges would shore up the population risk profile and ensure that carriers would want to compete.

    As we all know, the tax exclusion benefits employees of larger employers over those who are not employed, self-employed, or employed by small employers. It also advantages higher incomes over lower incomes, as tax brackets go up. This would mean employers would not be administering health care plans, a good thing from the perspective of top management but of course, not good for the job security for some benefits staff and consultants.

  4. Great idea – much simpler to administer and more fair. Longer term, though I think the tax exclusion for benefits should go away. There’s no moral or economic justification for it. If eliminated, some of the added tax revenue could be used for some blend of income and age-based tax credits to help pay for coverage. Everyone should be moved to the exchanges, with competitive exchanges available, jut just state and federal ones. Moving everyone to exchanges would shore up the population risk profile and ensure that carriers would want to compete.

    As we all know, the tax exclusion benefits employees of larger employers over those who are not employed, self-employed, or employed by small employers. It also advantages higher incomes over lower incomes, as tax brackets go up. This would mean employers would not be administering health care plans, a good thing from the perspective of top management but of course, not good for the job security for some benefits staff and consultants.


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