‘Cadillac’ Health Insurance Tax’s Flawed Defense

[Omaha Steve]

http://www.inthesetimes.com/working/entry/5386/cadillac_health_insurance_taxs_flawed_defense/

Wednesday January 6 5:53 pm

By David Moberg

Proponents of the excise tax on “Cadillac” health insurance policies argue that the tax will encourage employers to provide expansive insurance, which in turn will lead to less consumption of health services and will slow the rise of health costs.

It’s a deeply flawed argument: doctors, more than patients, decide what services are needed, and patients rarely feel the same burning desire for a stay in the hospital as they do for a stay on the beach.

In any case, many of the high-cost plans are not especially generous in coverage. They cost more because of the age, gender, geographic region, industry or other distinctions about the insured person that insurance underwriters use.

And if employers cut back on insurance coverage for these workers, they will either go without care they need–hardly an accomplishment Democrats want to claim–or pay out of their own pockets–an example of cost-shifting, not money saving.

But–excise tax advocates say–if employers don’t have to pay as much for insurance, they will pay higher wages, so workers won’t lose out and could gain. They argue that workers’ wages in recent decades have been squeezed by the growing cost of insurance to employers, and they point in particular to the late 1990s as a time when insurance costs moderated and wages increased more rapidly.

FULL story at link.

[Name removed]

1. Deleted sub-thread

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[safeinOhio]

2. How will that tax be applied to VEBA?

[Omaha Steve]

3. Kick

[Kansas Wyatt]

4. Thanks!

You might consider adding the last paragraph to your post from the link. It says it all.