♡bamaCare!!!’s “Cadillac tax” is just for plans provided by private employers — the whip cracks down on public sector workers, too. Robert Pozen explains:
In these negotiations over the next few years, local governments should be very concerned about running afoul of the “Cadillac” tax. In 2014, government healthcare plans were 17.5 percent higher cost than the average citizen’s plan, and their employee contributions were 45 percent less than the average plan, according to a survey of nearly 10,000 employers by United Benefit Advisors.
If these patterns continue, many state and city healthcare plans will run up against the “Cadillac” tax in 2018 – a 40 percent tax on the amount of total healthcare premiums (from employers and employees) exceeding $10,200 per year for individuals or $27,500 per year for families. In a 2013 letter, the deputy mayor for operations in New York City estimated that the Cadillac tax would cost the City $22 million in 2018, rising to $549 million in 2022. Similarly, the Association of Washington Cities, which offers a pooled plan to municipalities in Washington State, estimated that the “Cadillac” tax could increase local taxes by $76 million over the decade starting in 2018.
Normally I’m in favor of anything which encourages spending less on government workers who enjoy gold-plated benefits, total job security, and near zero performance scrutiny. But the savings encouraged by ♡bamaCare!!! will vary state by state, locality by locality. Everything will depend on whether your state or local government gets tough with the local public service union, or caves and passes the Cadillac tax on to the taxpayers.
In other words, I wouldn’t want to be a Blue State taxpayer in a few years from now, enjoying the benefit of paying the taxes on my plan and the plan still enjoyed by some petty school official.
Alternately, local governments could dump their workers onto the exchanges — and be subject to the $3,000 fine ♡bamaCare!!! imposes for doing so. And guess who’d be stuck with that bill, too?
You don’t really need to guess, do you?