Cadillac Health Plans; And Taxation Thereof

And I don’t just mean the HuffingtonPost/DailyKos/ crowd. There’s even a sense at the New York Times that the President’s faction has failed to grab history by the tail. Witness this column by Bob Herbert, who protests the tax on so-called “Cadillac health plans,” those which cost more than $23,000 for family coverage or $8,500 for single coverage. Because these dollar amounts will not adjust with inflation, Mr. Herbert notes that an increasing number of people will be subject to the tax as the years roll by.

Of course, Mr. Herbert is carrying water for organized labor, which is a staunch opponent of the “Cadillac tax.” One of Big Labor’s major successes has been to negotiate juicy health benefits, especially for retirees. (This is especially true in the public sector, as described in a new book by Steve Greenhut.)

Conservatives haven’t really weighed in on the “Cadillac” tax. Good: Let the unions fight their own battle. It is a tax hike, which any conservative should oppose. However, if it were re-cast in a different bill, it could be used to fund a universal tax credit or voucher, which would reduce Medicaid and SCHIP dependency. Indeed, lest we forget, this is the path Senator McCain took in his presidential campaign, and which I discussed favorably at the time.

This blog post originally appeared on Free American Health Care.

Nothing contained in this blog is to be construed as necessarily reflecting the views of the Pacific Research Institute or as an attempt to thwart or aid the passage of any legislation.

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