Killer Cadillac tax: Even Democrats are angry
Theres one part of ObamaCare that even many Democrats hate the so-called Cadillac tax on generous health plans.
It doesnt go into effect until 2018, but employers know its coming and are already cutting health benefits to stay under the Cadillac line. Its clobbering workers and roiling union negotiations across the country.
The growing uproar over this tax may even present an opportunity for Republicans in Congress to woo enough Democratic votes to pass changes to ObamaCare and overcome President Obamas likely veto.
As far back as 2009, the president said he wanted to penalize fancy plans that end up driving up costs. The Affordable Care Act slapped a 40 percent tax on these plans, starting in 2018.
Yet its not just fancy people who have these plans. Over the years, countless blue-collar and union workers have opted for these generous benefits instead of wage hikes. Thats why AFSCME leader Gerald McEntee blasted Obamas idea as bulls----.
Now the manure is hitting the fan. In 2018, about half of companies will have to pay the tax if they dont first reduce benefits below what Washington considers excessive: $10,200 for individuals and $27,500 for families. Companies are already raising deductibles and copays or skimping on coverage, according to Towers Watson benefit consultants.
Not that the presidents team ever admitted that ObamaCare would tax health benefits quite the contrary. When ObamaCare required the value of your health benefits to be reported on you W-2, raising fears that it would be taxed, White House spokesperson Stephanie Cutter said, Dont believe it ... you will absolutely not pay taxes on these benefits.
In 2011, ObamaCare architect Jonathan Gruber told a select audience that he thought the administration would get away with the deception by mislabeling it, calling it a tax on insurance plans rather than a tax on people.
Union leaders werent fooled. In July 2013, three large unions, including the Teamsters, sent a letter to congressional Democrats warning that the tax will destroy the very health and well being of our members.
Recalling Obamas promise that if we liked the health plans we have now, we could keep them, the union leaders were blunt: We voted for you. We have a problem: You need to fix it.