There’s no other way to put this — the shit’s about to hit the fan. Robert W. Wood explains the 40% “Cadillac tax” coming in 2018:
Plainly, the Cadillac name is a gross misnomer. It will apply to many benefits that are hardly elite. The sea change is enormous. Company provided health benefits have not been taxed for generations. And that is exactly what the deceptively named Cadillac tax does. It is broad too, applying to health savings and flexible spending accounts, supplemental insurance plans, and more.
Even plans that are not hit by the 40% tax in 2018 soon could be. After all, the Cadillac tax is linked to the consumer price index plus 1%. Medical and insurance costs are growing far faster, so more and more plans will be hit with the 40% each year. A survey by Mercer anticipates that one-third of employers will be hit by the tax in 2018, growing to 60% by 2022. It could be worse still.
And this is just want we know so far. It could be far worse. The IRS has already showcased how incredibly complex this tax will be, setting out approaches to the excise tax. Of all the taxes in the ironically named Affordable Care Act, none is more onerous, a whopping 40% on top of all other federal taxes.
It’s the end of private insurance, comrade. You will take what is mandated on the exchanges, and you will like it.