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Jan
5

More On Congress Taxing “Cadillac” Health Plans

by Dr. Doug Perednia

One problem with writing about all of the “hell” in “hellthcare” is that there’s so much of it.  For every bad decision, there are scores of adverse consequences to doctors and patients.  The sheer volume makes it easy to miss whole purgatories.  Sad to say, this was the case with our last post on Congress’ cunning 40% excise tax “high-cost” health plans.

As you know, our last post discussed how fairness, equity and logic seemed to be uniformly absent in the Senate’s proposal to tax high-cost or “Cadillac” health plans.  To be truthful it was a hard post for a mere clinician to write.  An article published in The Washington Post by an MIT economist noted that the plan “has much to recommend it, which is why it is almost universally favored by health policy experts”.  This language logically implies that anyone criticizing the measure: (a) is almost certainly not an expert; (b) is expressing views and analyses that fly in the face of what must be the truth as provided by “real” experts; and (c) must therefore something of a ignoramus.  The only solace to be found in writing such a piece is that these are undoubtedly the same experts who helped design and build the uniquely dysfunctional healthcare system America enjoys today.

At the same time this post was being published, syndicated columnist Bob Herbert wrote an op-ed piece that pointed out some adverse consequences to the proposed health plan tax that I’d missed discussing entirely.  It seems that – due to inflation – nearly 20% of all workers with employer-provided coverage would be affected by what was supposed to be a “fat cat” tax within three years of implementation.  The likely (and logical) response of employers would be to drop these plans entirely.  After all, why the dickens would you increase your business’ healthcare costs by another 40%?  This leaves these employers with two possible economic alternatives.  The first alternative is that they would simply hang onto the money themselves, thus boosting profits and transferring wealth from middle class workers to their large corporate employers.  The second possibility is that employers give all or part of the former premiums to their employees in the form of cash, which then becomes taxable income for state and federal governments.  Either way the ultimate financial burden of the tax falls almost entirely on the middle class.

One is left to wonder whether the “experts” who crafted and support this plan intended for millions of middle-class Americans (thirty-one million according to Herbert’s estimate), to be its ultimate victims?  If so, that’s a pretty cunning way to stick it to these patients and their families.  If not, can we somehow revoke their “expert” status?  Or at least prevent them from talking to our elected representatives?

Either way, the road to your hellth and mine is paved with their intentions.

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Related posts:

  1. This Week on the Demon Channel: “Cadillac” Health Plans
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