CMS: Excise Tax On Insurance Will Make Your Insurance Coverage Worse And Cause Almost No Reduction In NHE
By: Jon Walker
December 11, 2009
The new excise tax on employer-provided health insurance will result in most people getting worse health insurance from their employer, insurance that covers less. That is just not my conclusion, it is the conclusion of the CMS.
In reaction to the tax, many employers would reduce the scope of their health benefits. The resulting reductions in covered services and/or increases in employee cost-sharing requirements would induce workers to use fewer services. Because plan benefit values would generally increase faster than the threshold amounts for defining high-cost plans (which are indexed by the CPI plus 1 percent), over time additional plans would become subject to the excise tax, prompting those employers to scale back coverage.
To translate, your employer will reduce what your current insurance plan and put in place high co-pays and deductibles. The result is that many people with employer-provided health insurance will see their insurance get much worse. For younger, healthier employees, possibly getting less comprehensive insurance but maybe higher wages (I think it is very doubtful that there is a pure dollar for dollar passthrough), this might be a decent deal. For older, less healthy employees this is a very bad deal. They will be forced to pay much more out-of-pocket for their health care.
http://fdlaction.firedoglake.com/2009/12/11/cms-excise-tax-on-insurance-will-make-your-insurance-coverage-worse-and-cause-almost-no-reduction-in-nhe/ALL workers have lost under the "deal" made by top union officials with the Senate and Obama administration.
Senate Democrats and President Obama won their 40% health insurance tax without a serious fight by organized labor.
The union officials were given three years to downgrade their health insurance plans with greatly reduced benefits so that employers won't have to pay the health insurance tax. After that, the exemption ends. Well, it really won't be needed when cheap bare bones health insurance plans are negotiated.
And tens of millions of workers who are not lucky enough to be union members will have the 40% tax take effect three years sooner.
And on top of those "wins" AFL-CIO President Trumka and a few other top union officials agreed to bury the tax on wealthy Americans as proposed in the House health care bill!
Wonderful.
The "deal makers" have handed right-wing Republicans and anti-labor employers a big club to use against organized labor and Democrats who vote for this bill. They'll pretend to be "populist" candidates for the people. The right-wing has already begun practicing their rhetoric and testing their propaganda.
Try putting some lipstick on the health insurance industry protection act and see if the voters buy it in 2010.
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