The PSEA website has been encouraging members to write their congressmen to protect their health care plans from the excise tax promises in Obamacare on “cadillac” plans (yes — this is the same idea that John McCain put forth and was profoundly damaged by). Nationally, a deal has been cut — read for the details…
the excise tax was one of the bigger ones. Union leaders were able to soften the tax’s impact a bit: It won’t take effect until 2013; it will affect plans that cost more than $24,000 per family or $8,900 for individuals, up slightly from the levels in the Senate bill; those levels will be adjusted annually for inflation and adjusted additionally for plans that are expensive because they cover inherently expensive groups, and they won’t include the cost of dental or vision plans after 2015; plans worked out through collective bargaining will be exempt from the tax altogether until 2018; and by then, unions in collective bargaining agreements would be able to buy insurance through a new exchange system the legislation would set up, instead of going through employers. (In the years in between, unions could try to renegotiate their contracts to get higher wages instead of so-called Cadillac healthcare plans.) The changes mean the tax won’t raise as much money to offset the costs of the bill — the tax would raise $90 billion over 10 years, instead of $150 billion as the Senate bill had it.
By the way — just two years ago… June 2008
Providing tax credits of $2,500 to individuals and $5,000 to families as an incentive to buy health coverage.
This provision is not unlike the proposal first made by President Bush at last year’s State of the Union Address. The President called for ending the longstanding tax exemption consumers get on any health insurance benefits paid for by their employer. The President would replace that with a standard $7,500 deduction for individuals and a $15,000 deduction for families.
McCain would also end the employer tax exemption—meaning that if an employer spends the average $12,000 a year on family health insurance, the worker would now have a tax bill on the portion of the $12,000 of benefits paid for by the employer.
Like Bush, McCain would offer a personal tax offset, but he would do the new offset a bit differently than Bush.
McCain would give each single person a $2,500 tax credit and a $5,000 tax credit for a family who had health insurance. A tax credit means that when taxpayers calculate their taxes, instead of taking a deduction, as Bush would do, under McCain’s plan they would subtract the tax credit ($5,000 for a family) from their final tax bill (and they would likely be able to take advantage of the credit during the course of the year to pay their monthly premiums).