The Affordable Care Act (ACA), despite its laudable policy goals, contains a provision that could negatively impact the health of millions of middle class individuals, and that is the so-called “Cadillac” tax. Increasingly it is being re-evaluated by policy experts, and there is growing sentiment that it should be rewritten or even repealed.
This excise tax was intended to encourage employers to eliminate overly rich healthcare benefits that could lead to excessive, inappropriate utilization of heathcare services and unnecessary healthcare spending. In addition, the revenue from the tax was to serve as a funding source for a portion of the ACA’s insurance subsidies.
