Analysis: Excise Tax Could Equally Hit Union, Nonunion Health Plans
At least 80% of the workers whose insurance coverage would be subject to the tax in 2019 would be nonunion employees, which aligns with the overall breakdown of union and nonunion workers who have employer-provided health coverage.
Organized labor has strongly opposed the tax, which would be used to fund health reform legislation.
Ken Jacobs of the University of California at Berkeley Labor Center and William Dow, a professor of health economics at Berkeley and a member of President George W. Bush' Council of Economic Advisors, conducted the analysis. The study received funding from the California Endowment and the Institute for America's Future.
The analysis considered two versions of the excise tax and found similar results for both iterations. The Senate health reform bill (HR 3590) includes a 40% excise tax -- expected to raise $150 billion over a decade -- on plans worth more than $23,000 for families and $8,500 for individuals.
In January, the White House and organized labor leaders negotiated a separate version of the tax that raises the threshold for affected plans, limits the tax for businesses that employ many female and older workers, and exempts government workers and union plans from the tax until 2018.
The analysis found that the changes would lower revenue from the tax by $41 billion, and 71% of that would accrue to nonunion workers.The report also found that if employers retain their current coverage, 23% of plans would be hit by the tax by 2019 under the Senate's version of the tax, while 14% would be subject to the tax under the revised plan (MacGillis, Washington Post, 2/18). This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.