When I initially heard the term "Cadillac Health Care Plan" bandied about, my "Bovine Excrement" detector was mildly set off. Then when I heard our President repeat his statement that he would not favor a new tax for the middle class, defined as those making 250 thousand a year or less, I was reassured that this would not affect me or mine. Then when I started hearing it more often brought up, and brought up by those in the President's inner circle, my detector once again jumped and buzzed into action.
First, when any politician uses the term "Cadillac" in a description of something, I can't help but think of Ronald Reagan's "Cadillac-driving welfare queen buying a bag of oranges with food stamps and using the change to buy beer". Certainly an "us" (meaning hard-working, tax paying Americans) against "them" (meaning lazy, resource-wasting bums) divisive argument.
So who is the latest "Cadillac" bum? Why, employees in the banking industry, of course! On July 31, NPR's Marketplace had a brief discussion on health care:
Congress is getting ready to head home for August break with no clear deal on the table. So let's hear about one buzz phrase that came up this week. The idea is to tax so-called "Cadillac" or "gold-plated" benefit plans.
Joel Rose explains what those are.
Joel Rose: The average family's health insurance policy costs $13,000 a year. Some plans cost twice, even three times that much. Those are the plans the White House is talking about taxing. Here's presidential adviser David Axelrod on CBS's Face the Nation.
Axelrod: This was an intriguing idea to put an excise tax on high-end health care policies, like the one the executives at Goldman Sachs have.
Goldman Sachs didn't return my calls, so I didn't get to ask exactly what a $40,000 a year health insurance plan covers. But Len Burman at the Tax Policy Center in Washington thinks he knows.
Len Burman: There's some plans for which almost everything is paid for. So you go to the doctor, you don't worry about what's prescribed or how much is being spent, because you're not responsible for any of it.
AHA! Those bums that have "Cadillac" plans are those same greedy banking executives that held our financial system ransom last year and are now raising our credit card interest rates to arm-breaking heights! Yeah! Stick it to those greedy bankers! No more beer and oranges for them!!!
Len Burman, (fellow at the Tax Policy Center), probably hits the working definition, though. The "Cadillac Plan" is a low deductible, low co-pay health insurance. In other words, it provides payments to health care providers for services rendered with little out of pocket expense to the people who hold the premiums.
The idea that the "Cadillac" health care plan tax is just for greedy bankers is debunked in a September 20th article in the New York Times by Reed Abelson. This article points out that there are other groups that are going to be hit by this as well. Union workers, for instance. fire fighters, specifically. Now, this is looking more and more middle class by the minute. The article also mentions workers in their 50s and small businesses. This is getting more middle class by the minute.
In a paper published in March 2009 by the Economic Policy Institute, written in conjunction with the Congressional Budget Office, titled "Who is Adversely Affected by Limiting the Tax Exclusion of Employment-Based Premiums?", the following employee classes would be affected the most:
-Families
-Women
-Older Workers (over 50)
-Workers employed less than full time
-Union workers
-Service Industry Workers
-Workers in Wholesale and Retail
-Employees at Non Profit organizations
-Those workers making over 47,000 a year
-Small Business Employees
More and more this is looking less and less like a tax on greedy bankers and more and more like a hefty tax on more and more of us while not necessarily meeting our health care reimbursement needs.
If most people who have decent coverage, that is low deductible, low co-pay coverage, "cadillac" coverage, coverage that actually provides for using health care, are going to be heavily taxed on that policy, then they should be allowed to chose a government run health care reimbursement system.
They should be allowed a Public Option.
Everybody should be allowed the public option, not just 10 percent of Americans.
The fight must continue.