The last major piece of President Barack Obama’s health care law could raise costs for thrifty consumers as well as large corporations and union members when it takes effect in 2018.
The so-called Cadillac tax was meant to discourage extravagant coverage. Critics say it’s a tax on essentials, not luxuries. It’s getting attention now because employers plan ahead for major costs like health care.
After the University of Missouri was met with significant student backlash for dropping health insurance coverage for graduate students, universities in Georgia, Illinois and Michigan are juggling the same decision, building on a growing concerns from students regarding dwindling benefits.
Obamacare exchanges are failing to provide adequate enrollment information to the IRS for the payment and verification of tax credits, according to a new report released by the Treasury Inspector General for Tax Administration (TIGTA).
In order for the IRS to properly administer Obamacare, exchanges are required to provide monthly enrollment data, known as “Exchange Periodic Data.” As part of the law, Obamacare enrollees may elect to have their estimated tax credit sent directly to their insurance provider as partial payment for monthly premiums. But because this is only an estimate based on expected income, the IRS relies on Exchange Periodic Data to ensure that individuals have received the proper tax credit, or if they were eligible at all.
Bigger might be better, but it can also be pricier—at least when it comes to Obamacare.
A new analysis found that the largest insurer in each of the states served by HealthCare.gov raised their prices in 2015 much more sharply—by an average of 10 full percentage points—than smaller competitors on that federal Obamacare marketplace.
A popular middle class tax benefit could become one of the first casualties of the Affordable Care Act’s so-called Cadillac tax, affecting millions of voters.
Flexible spending accounts, which allow people to save their own money tax free for everything from doctor’s co-pays to eyeglasses, may vanish in coming years as companies scramble to avoid the law’s 40 percent levy on pricey health care benefits.
Section 9001 of the Affordable Care Act (ACA), set to take effect in 2018, imposes an “Excise Tax on High Cost Employer-Sponsored Health Coverage”, which has come to be known as the “Cadillac Tax” (not due to a corporate sponsorship from GM, however). This is a 40 percent tax on employer-sponsored health benefits that are defined as “excess benefits,” which is defined as anything in excess of $10,200 (employee only) or $27,500 (family) coverage for 2018, with adjustments for subsequent years. The “excess benefits” include not only benefits provided by the employer, but also the portion of premium paid by the employee, as well as any money the employee chooses to set aside out of salary to pay for health expenses via a Flexible Spending Account (FSA).
Big business is against it. So is big labor. Ditto for K Street. What do they want? The repeal of Obamacare’s tax on high cost health care plans. A growing number of Republicans and Democrats in Congress are lining up to agree with them.
Health Care: When insurers requested huge rate hikes for their 2016 ObamaCare plans, we were told not to worry because state regulators would force them down. But that’s not happening. Death spiral, anyone?
As fall approaches, we can expect to hear more about how employers are adapting their health plans for 2016 open enrollments. One topic likely to garner a good deal of attention is how the Affordable Care Act’s high-cost plan tax (HCPT), sometimes called the “Cadillac plan” tax, is affecting employer decisions about their health benefits. The tax takes effect in 2018.
Consumers are trying to figure out how they’ll absorb the double-digit increases in health insurance premiums that many insurers have announced for next year. American employers, meanwhile, are worried about what will happen to health costs several years out, in 2018.