This Week in Health Care Reform : EasyToInsureME Health Insurance

Christopher Dodd (D-CT).

A main point of contention between the two houses of Congress pertained to the
40 percent excise tax on high-cost health insurance plans passed by the Senate. Since many labor union members would be affected by the tax on high-cost health insurance plans, the House of Representatives was not supportive of this provision in the Senate bill. Union leaders have also been included in key negotiations on this provision, and on January 14, signaled that they are ready to support the merged legislation with the compromised provision.

The main revenue source for the Senate’s health care reform bill (H.R. 3590) would be from an excise tax – beginning in 2013 – on employer-provided, high-cost health insurance plans costing more than ,500 for individuals and ,000 for a family. The reported compromise on the legislation now makes the tax kick-in on policies costing ,900 for individuals and ,000 for families. The tax threshold would still rise at inflation plus one percentage point, as is currently written in the Senate bill. Additionally, dental and vision benefits would be removed from the calculation of threshold costs, and plans offered by state and local governments, as well as plans covered by collective bargaining agreements, would be exempted from the excise tax until 2018. This would allow current agreements to expire and allow for negotiation of new contracts.

In an effort to make up the lack of