Cadillac Tax

Tuesday, January 05, 2010

New York Times columnist Bob Herbert says there's a hidden agenda in the Senate's plan to tax "Cadillac" health insurance plans.


Bob Herbert

Comments [11]

Nate from Manhattan

Let's revisit this in two years see how many plans will manage to make it just under or over the thresholds, depending on which is more beneficial to the insurance companies.

What do most people think will happen?

Jan. 05 2010 11:40 AM
David Mitchell from Rockland County

I own a small business (defined for health care purposes as under 20 employees) in Rockland County insured by Empire BlueCross BlueShield. Small businesses can not get the less expensive rates enjoyed by larger companies. As examples of my plans that apparently will be affected by the "Calillac Plan" tax, a "Direct Connection HMO" individual plan including dental & drugs (not vision coverage) costs me $797.55 a month ($9,570.60 a year - well over the $8,500 threshold). A medicare supplement/carveout Direct Connection HMO plan even costs $709.26 a month (just over the $8,500.00 amount).

Jan. 05 2010 11:06 AM

Herbert is conflating two different theories. The idea of the excise tax on the "Cadillac" plans is to contain premiums. The idea is that there is something of a sweet spot to premiums. The insurance companies are, theoretically, exploiting labor market competition by offering excessively expensive plans. The excise tax effectively caps the costs of premiums at a level that should, reasonably, more than cover insurance company costs.

The theory that people will be more conservative with their health care expenses is more applicable to the idea of private health savings accounts. Herbert is right to condemn that logic, but its not the same idea as taxing excessively expense plans.

Jan. 05 2010 10:52 AM
Helen Northmore from New York

Thank you for Mr. Herbert's segment. It's so helpful to hear how the provisions of these Health Bills might actually play out.

Jan. 05 2010 10:47 AM
Mary from Park Slope

FYI- Botox and other purely cosmetic procedures are NOT covered by even the most 'cadillac' insurance plans.

There was a 'cosmetic' tax proposed but it was overruled.

Please let your guest know he should know what is and what is not covered.

Jan. 05 2010 10:46 AM
Chris M from Manhattan

Mr. Herbert has some important criticisms of the health care reform bill. I wonder, however, if he mischaracterizes it's proponents who believe it will reduce overutilization of health care services. Are we really talking about incentivizing people to go to the doctor less, or incentivizing doctors to reduce unnecessary treatments?

Jan. 05 2010 10:45 AM
Jennifer Hickey from Flushing, Queens

What about the plan of federal employees, including Congress and the President. Don't they have a Cadillac plan?

Jan. 05 2010 10:45 AM
Susan from Kingston

What exactly is a generous health plan in terms of care? It needs to be defined.

Jan. 05 2010 10:43 AM
Renato from NYC

What great timing! I just found out that our insurance at work is going up 50% starting in March. That will cost me an extra $400 per month for the same exact coverage. Isn't anyone looking into this type of organized crime?

Jan. 05 2010 10:42 AM
hjs from 11211

so it's just like the AMT

Jan. 05 2010 10:38 AM
Peter from Central New Jersey

I have read that the compulsary insurance aspect of the Health Care Reform bill is going to be challenged as unconstitutional. Any comments?

Jan. 05 2010 10:25 AM

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