How Would the Tax Have Worked?
Both of these factors contributed to the controversial nature of the Cadillac tax.
How Would the Cadillac Tax Have Been Beneficial?
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This is because the insurance planrather than the patientis paying for all or nearly all of the cost.
Critics of the Cadillac tax noted that it would unfairly penalize employers based in those areas.
What About Inflation?
Healthcare spending had been rising faster than the CPI for a long time.
That could have resulted in the Cadillac tax eventually becoming a “Chevy tax.”
It’s important to understand that this analysis applied to employers rather than employees.
And eventually, run-of-the-mill plans (as opposed to just high-end plans) might have been impacted.
Over the long run, that can result in chronic conditions that aren’t well-controlled.
its benefits weren’t dramatically better than average), but that had higher-than-average premiums due to other factors.
Some high-premium plans might have high premiums for reasons other than their benefit design.
But employers, unions, consumers, and politicianson both sides of the aislewere largely opposed to it.
But there was certainly not universal agreement that the Cadillac tax should have been repealed.
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