Why are DEMOCRATS insisting on taxing inadequate, overpriced insurance as "Cadillac" w/o indexing...

[Faryn Balyncd]

....for inflation?


Why are we ignoring the fact that classifying policies as "Cadillac" on the basis of COST, ignoring that some of these overpriced plans that will be classified as "Cadillac" on YEAR ONE, prior to any inflation, are actually inadequate, is a fundamentally flawed methodology?


Will this not hit the middle class quicker & harder than the Alternative Minimum Tax?


Disregarding morality, is this not political suicide?


http://www.democraticunderground.com/discuss/duboard.php?az=show_mesg&forum=433&topic_id=108585&mesg_id=108585

http://www.democraticunderground.com/discuss/duboard.php?az=show_mesg&forum=389&topic_id=7389618&mesg_id=7389618

[DrDan]

1. sure seems like it to me

[FBaggins]

2. If we're going to get to a single-payer system

then you've got to squeeze a little bit at both ends.

[dysfunctional press]

7. they're squeezing hardest in the middle.

same as they always do.

which is why there's not much of a middle class left to squeeze.

[FBaggins]

13. Ah... of course. Because the middle class...

...are always the ones with the best health insurance.

[dysfunctional press]

23. most union members are 'middle class'...so in that respect, yes.

[FBaggins]

32. But they aren't the TARGET of the "cadillac" language

they're just the unintended victim.

The tax is PRIMARILY for the wealthy.

[dysfunctional press]

51. really? how many "wealthy" people will it affect, versus how many union members?

unintended 'victims' are still victims, and will see themselves as such when it comes time to cast a ballot.

btw- if the tax is PRIMARILY for the wealthy- why didn't they include a minimum income to qualify for it..?

my father is a retiree, on a fixed income who could be taxed over $5000 for the value of his union insurance. that's obscene. the trade unions gave up a lot of money on their paychecks thru the years to have quality insurance benefits that would be there for them and their families when they need them most.

[Faryn Balyncd]

56. If the true target really were the wealthy, the "Cadillac" tax would be INDEXED for inflation.

Without indexing, there is a 100% probability that it will, within a few years, become a tax on ALL health insurance policies, nicely hidden from those that actually pay for it (the policy holders) since it is assessed at the corporate level, and collected from the public in the form of inflated premiums.

It is just a matter of how long it will take.

This bill fulfills almost ALL of the goals of Zeke Emanuel's plan: All private (no public option) & fund it by taxing all policies. The only major portion of Zeke's plan that is yet to be fulfilled is the complete privatization of Medicare, which he wants to do by forcing new enrollees to continue their previous private insurance.

But now that this plan mandates private insurance, Zeke's eventual goal will be easier to accomplish.

Months ago, long before the charade of "favoring" a public option was abandoned by the administration, Rahm approvingly called his brother Zeke's plan a "game changer", saying perhaps the public wasn't quite ready for it yet ( :sarcasm: ). Is Rahm a snake par excellance, or what?



Addendum:
(In your previous post (#2) you mentioned getting to a single payer system, a goal I share with you. Unfortunately, we have within our administration, working as a paid health care finance "White House consultant", an advocate of complete PRIVATIZATION OF MEDICARE, and we also have seen this person's brother, as Chief of Staff, single-handedly KILL the Public Option which the president claims to favor.)

[Edweird]

18. This isn't single payer. It is the opposite. Every step in this direction puts us further

from single payer.

[MNDemNY]

20. YUP!!!!!!!

That is why this bill must die.

[FBaggins]

24. The president doesn't appear to agree.

There's no question that his long-term goal is to get us to a single-payer system. He as much as admitted that we needed a decade or two of transitional work before we could get there.

[dysfunctional press]

27. he also said that any bill that he would sign MUST contain a 'public option'.

so apparently he was for it, before he was against it.

[Zhade]

60. Then there was his bald-faced documented lie about "not campaigning on a PO".

NT!

[Edweird]

37. Actually, there is a question as to what his long term goals are.

We already have single payer in this country. There is no need to re-invent the square wheel.
Our neighbors to the north have a system that is worth copying.

Instead of progressing, we are regressing. You are defending the intensification of the very issues that got us where we are.

Single payer was never 'on the table'. The public option was tossed. All that remains is a giveaway to the insurance companies.

[Zhade]

59. The president also happens to be a liar, so... there you go.

NT!

[truedelphi]

35. That is not how it is done in Scandanavia.

In those nations, there are progressive tax rates.

And luxuries are taxed heavily - so that if you eat at a restaurant, you pay the price in the form of heavy duty taxation.

Thus the middle incomed and lower incomed are not heavily taxed. People like this household - who rarely eat out now that the economy is so bad, we have to pay for our shopping in the thrift stores with the almost 8% tax to the state of California.

I would much rather see taxation hit those who can afford to spend heavily, than those who are on the very strictest of all budgets.

And the suggestion that Union members pay heavily for their decent policies is really a slap in the face to the Union members, and also to the ideals that USED to belong to the Democratic Party, before it went all Corporatist.

[mmonk]

3. It's a direct hit on the unions.

Therefore, that could have been a Republican measure as much as a Democratic Party measure even though they hate unions.

[Hello_Kitty]

6. It was part of McCain's plan, if you recall.

And we trashed him for it here. Rightly. Now DUers are pretending that never happened.

[mmonk]

9. Yes, I certainly do.

[DJ13]

10. Now they're embracing it, calling it a great first step

Go team!

[flyarm]

67. isn't that truely amazing!!..I never cease to be amazed by the cheerleaders any longer!

they just better never bitch around me, when they find out how totally fucked they are!

[paulsby]

8. taxing cadillac plans is , i agree, a hit on the unions and union workers

whether it was intended that way or not.

i am a union member with a cadillac plan.

[dysfunctional press]

11. my dad, a lifetime union 'operating engineer' says he'll NEVER vote for another Dem if it passes...

and all of his union pals say the same thing.

this is a HUGH miscalculation on the part of rahm emmanuel the administration.

[kenfrequed]

47. Yes

But Rahm's DLC buddies always wanted to pull the Democratic party away from its traditional "special interest" allies (read: labor unions, environmental groups, minorities, etc.) in order to 'be of broader appeal' (read: attract more money from corporations).

I too am disappointed by this attack on labor. Its idiotic.

[flyarm]

68. my hubby was a former VP of a Union that supported Obama and the dems..

Hubby is now retired, but we went to a Union meeting in Dec and i will tell you..if this TAX HAPPENS..there will be a huge public outcry from these union members!

I also belonged to my union for 33 years ..that would also be taxed if this goes through..and i will go fucking public with a huge outcry!..and will also never vote again!..for either party..they can all kiss my ass if this happens!

Oh and i have been an elected Dem in my state and have worked in the dem party for most of my adult life!..and given a shit load of money to the dem party..they can kiss my ass if this is passed the way it stands now!
I didn't work my whole life for my insurance to now get fucked by my own party in my late fifties..fuck that!

[FBaggins]

17. That's correct. However...

... a single-payer system would likely be a "hit" to union member coverage as well.

[Edweird]

19. How so?

[FBaggins]

29. I don't understand how there could be any question.

It isn't unheard of (though by no means is it universal) for union contracts to include 100% employer-paid insurance premiums with little to no co-pay requirement.

How can you get any better than that?

[Edweird]

38. Ok. so please explain to me why you think they should be taxed. Other than dislike for unions.

[FBaggins]

40. I don't think they should

Sorry.

The problem is that we want to tax the "wealthy" plans for having coverage "too good" compared to the norm we are trying to create, and we can't do that without impacting unions as well. The alternative would be to craft something that specifically exempted union plans and that would be politically damaging since most people aren't in a union.

[Edweird]

43. Well, that's not what's happening, now is it?

[FBaggins]

45. Did I say it was? n/t

[dysfunctional press]

52. "The alternative would be to craft something that specifically exempted union plans..."

if the tax is intended for the 'wealthy', why not include a minimum income under which it wouldn't apply?

[FBaggins]

57. Not a bad idea... but harder to sell

There's already a "tax on the richest x percent"... this was easier to explain as a tax on employers who hid part of their compensation from taxes by offering "too generous" health insurance plans. And even if we tried, it's easy enough to identify this as a break targeted at unions.

The problem is that with MOST things, the richest get the best. You could tax luxury cars and be reasonably confident that you wouldn't pick on too many middle class workers. You could tax jewelry over $50,000 in value and know that you wouldn't be taxing some young couple's engagement ring. Health insurance doesn't fit this perfectly because of the union negotiating success, but the tax is still easier to sell this way.

[dysfunctional press]

64. so apparently democrats don't want or need union votes in any upcoming elections..?

it'll be interesting to see how they fare in 2010 and 2012 if this abomination passes.

[mmonk]

21. Only if you consider Medicare a hit.

[FBaggins]

26. Over fairly typical union-negotiated health insurance? Oh yes.

It's most certainly better than Medicare.

Lots and lots better.

[Hello_Kitty]

25. No it wouldn't

Single payer would cover all their basic health care and unions could negotiate for supplemental policies that cover the extras. It would be a total win for unions, and everyone.

[FBaggins]

31. They already have "all their basic health care" covered

The stuff you're saying they could negotiate (good luck) is stuff they already have. How is that not a step backwards?

I'm not saying that this is a good enough reason to kill single-payer... just that unions have done a pretty good job of hadling health insurance in their negotiations. It's unlikely that any program that covers everyone and is paid for by the government... would be any better.

[mmonk]

33. There are unions in Canada which is single payer and they

still negotiate better wages and benefits. The current Bill here in the US singles out their hard earned negotiated terms by adding a tax. No new tax would be added on their benefits if we had single payer.

[FBaggins]

39. They also would not retain their current benefits

Claiming that they might improve things in the future doesn't change the fact that it would be a step backwards.

[dysfunctional press]

53. that would depend on what form 'single-payer were to take.

they may very well be able to keep certain aspects without a problem.

[Raineyb]

36. Ridiculous!

With a single payer system unions wouldn't have to negotiate pay raises in lieu of health care they'd actually be able to negotiate better raises for their members. That's a benefit not a hit.

[Edweird]

22. Corporations tend to dislike unions intensely. This admin LOVES corporations.

Now that the election is over, those unions have lost their usefulness.

[mmonk]

28. Until the next election.

[Zhade]

61. Man, is he gonna be surprised.

NT!

[OHdem10]

4. Yes they do hit the middle class. Even some people consider

mandating a person to buy Insurance a tax.

[DJ13]

5. Disregarding morality, is this not political suicide?

If you think about the influence of money in our system, party no longer matters much.

Obtaining the most they can for their campaign donors (and potential future employers) is now the main priority to people in Congress.

[mmonk]

16. It certainly attacks directly the progressive coalition that gets out the vote

for Democrats. Jane Hamsher has it right about Rahm no matter what people say about her.

[DJ13]

30. Yes she does

He really needs to be pushed out of the WH if were to have any hope of the progressive reform Obama campaigned on.

[Zhade]

62. We still vote, allegedly.

NT!

[madrchsod]

12. follow the money

they are being paid by the insurance companies to kill real healthcare reform...

[TheKentuckian]

14. Because they are dedicated to preserving the status quo

but must reign in at least the systemic costs, I reckon.

I see it as insanity. Going anti-union is just the first step in becoming anti-worker. This is not the kind of thinking that leads to a rising tide that will lift all ships but rather one that will scuttle most of those crafts.

[Zhade]

63. Nice analogy!

NT!

[Xithras]

15. Whistling past the graveyard

The heads of both the SEIU and the AFL have stated their opposition to the bills in their current forms, and the Democratic leadership has chosen to ignore them. The tax on union plans is a giant middle finger pointed at organized labor.

The party leadership seems to be forgetting that organized labor has endorsed and supported Republicans in the past, and will do so again if its membership screams loud enough. All it's going to take is one big tax bill for most union members to start screaming about it, and one Republican willing to support a "repeal" in exchange for union financial support. Union leadership is elected, and that elected leadership is aware that they can't afford to sit idly by while their hard fought benefits are sucked away by political vampires. They'll either have to fight the Democratic party on this issue, or they'll be replaced by people who will.

[hughee99]

34. Is it a "cadillac" plan based only on cost or on coverage too?

If I pay a lot of money for shitty coverage, will I now have to pay an extra tax, as a "penalty" for getting screwed by my insurance company?

[Capn Sunshine]

41. Or could it create downward pressure on costs via demand?

Just speculating like you guys

[mmonk]

42. I'm not sure I follow.

Increased demand lowers costs?

[Capn Sunshine]

44. no, demand migrates to policies priced below the cadillac tax level

depends on how you see taxes and open marketplace. You don't think someone will offer a plan that has lots of features yet is priced under the tax ?

If they don't, DU should.

:hi: right Skinner? (see AARP business model)

[rudy23]

46. I believe they do want to commit political suicide so they can lose in '10

That way they can use the big scary R's as a fundraising tool, while passing right-wing corporate legislation with a built in excuse.

They want to win in 2010 as bad as the St. Louis Rams wanted to win and lose their number 1 draft pick on Sunday.

[Cicada]

48. Tax on Caddy plans should slow med inflation

experts across the political spectrum think a tax on caddy plans should help slow down the increase in medical costs

[Telly Savalas]

55. At the cost of poorer health outcomes.

The slowing of medical cost increases via this tax occurs exclusively by lowering utilization of medical services.

Taxing plans with low copays, deductibles, coinsurance, and out-of-pocket maximums will result in an increase in the movement towards plans with higher copays, deductibles, coinsurance, and out-of-pocket maximums. Such higher costs borne by the insured individual will make that individual think twice before using medical services. Hence the usage of medical services decreases - that's how costs are put in check.

But the problem is that a large percentage of these avoided medical services would be beneficial to the patient. (Unless you believe that despite their reputation of being overzealous in denying claims, health insurance companies are happily paying billions every year for frivolous claims.) So essentially the lower costs comes with the reduction in beneficial/necessary medical care.

In my opinion, this funding mechanism is the worst part of the bill. I'm not in the "Kill the Bill" camp. I recognize the political constraints and believe that on the whole this bill is a step in the right direction. However, this tax is bullshit. Hopefully it will get removed when the House and Senate reconcile their bills -- it's not in the House version, yeah?

[Nikki Stone1]

49. Exactly exactly exactly.

:grr:

[PHIMG]

50. +1 - they don't think the media will allow the republicans to use this against them

[Thothmes]

54. The members of the Senate do not have the backbone

to discuss a general tax to support the national health care program. They "fund" the program with a tax on what most Americans,on the surface would not disagree with. This is a tax on "cadillac" plans of the supposed wealthy. However, the mental giants in our Congress often do not know the details of the the laws they pass, nor do they care. So long as they can boast of "health care reform" during the next election cycle. this is just my opinion.

[Zhade]

58. Because they're dishonest, don't-care-about-us neoliberals?

I mean, it's been that way for a few decades now...

[senseandsensibility]

65. This should be obvious

to any progressive.

[unkachuck]

66. why....

....do corporate Dems do anything?....for corporate money!....someone other than a corporation will have to pay for the uninsured, it might as well be you and me....

"...is this not political suicide?"

....nope, the system is rigged....