Excise tax on high-cost health plans would have nonunion impact, study shows

[alp227]

Source: Alec MacGillis, The Washington Post

A proposed tax on high-cost health insurance plans, an element of Democratic health-care legislation that has been strongly opposed by organized labor, would actually fall equally on nonunion plans, according to a new analysis.

The controversial tax has been widely viewed as a labor issue, but at least 80 percent of the workers whose plans would be subject to the tax in 2019 would be in nonunion jobs, according to the analysis by Ken Jacobs of the University of California at Berkeley Labor Center and William H. Dow, professor of health economics at Berkeley and a member of President George W. Bush's Council of Economic Advisers.

This impact is roughly in line with the overall breakdown of nonunion and union workers with employer-provided plans. And it would be true both under the version of the tax passed by the Senate and a more labor-friendly one the White House agreed to last month.

The excise tax on so-called Cadillac health plans has emerged as one of the most contentious elements of the proposal that congressional Democrats are cobbling together from bills that passed the House and Senate.

Read more: http://www.washingtonpost.com/wp-dyn/content/article/2010/02/17/AR2010021705126.html

[dkf]

1. Does it fall heavier on high cost of living areas and employers who have older employees?

[groundloop]

2. Probably, but hard to tell for sure

All I've found so far is that they want to tax plans that cost over $23,000 per year for families, or $8500 per year for individuals. That seems like a fairly high threshold, so it would seem logical that most union jobs wouldn't be affected. The tax would be 40% of the difference between the cost of the plan and either $23,000 or $8500.

[karynnj]

3. They are speaking of tweeking the thresholds up in the fix

Whether union or non-union, an alternate way of looking at this is that the people with these plans and their employers currently have and have had for years a really nice tax break worth thousands more than the average tax payer.