You could never really describe the health insurance industry as sleepy. Born during World War II to address a labor shortage, employer-sponsored coverage may have, at times, been the butt of jokes similar to those aimed at accounting and banking. However, Eisenhower’s no longer in office and as Virgil said, “Health is the greatest wealth.” It trumps mere money. So in recent decades, from about when employers started turning to HMOs to contain costs (what a coincidence!), coverage debates run like the bulls of Pamplona: movement aplenty resulting in a goring now and then.
Employers, who, for the most part still pay the freight, feel as if they may be the next goree thanks to the Cadillac tax. Cadillac plans are those which cost more than $10,200 per individual and $27,500 per family per year. Employers offering such benefit packages will pay a 40 percent excise tax on any amount above that threshold starting in 2018.
Enter the fight or flight response, a condition alluded to on cave walls and which Virgil used as a literary trope. As the New York Times reports, the tax spurs some companies to consider replacing Cadillac plans with “plans that could prove far more expensive for workers and their families.” Some companies have already changed coverage, the story notes, as have Harvard and George Washington universities and Manchester, N.H.
Proponents say Cadillac plans encourage overutilization and consider the tax as a way to end health care as a tax write-off, “one reason there is such a heavy reliance on employers to provide health coverage.”
Well, the enemy of my enemy is my frenemy and the issue manages to place employers and unions on the same side of this fight. A coalition so new that it is still, as of this writing, building its web page sprang up recently. Called the Alliance to Fight the 40, it includes unions, employer associations, politicians (there’s bipartisan support) and companies such as Pfizer and Cigna.
Yes, health plans are involved. The Times story quotes a Kaiser Permanente spokesman as promising to continue offering comprehensive and affordable coverage, tax or no tax.
It’ll be interesting to see how all this plays out. Or, as Virgil said, “Wherever the fates lead us, let us follow.”