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Nine-Million-Member Union Coalition Calls For Defeat Of Cadillac Tax

01.14.10

Nine-Million-Member Union Coalition Calls For Defeat Of Cadillac Tax

by Sam Stein

http://www.huffingtonpost.com/2010/01/12/nine-million-member-union_n_420524.html

A coalition of federal and postal employees, numbering nearly nine million members, sent a letter to congressional leaders on Tuesday insisting that the final health care bill not include an excise tax on high-end insurance plans.

Sixteen unions penned the letter amidst increasingly tense negotiations between House and Senate leaders over how to structure the pay-for provision in the final health care bill. The Senate favors the tax, citing its benefits in reeling in health care costs. Approximately 190 House Democrats have signaled that they will oppose it out of concerns that it will unfairly hit working-class families.

The letter from the federal and postal employees frames the tax as both inequitable and potentially damaging to the prospects of recruiting future government employees. The groups write:

“While the excise tax is slated to be imposed on the insurers on so-called high cost plans, the tax will be passed on to enrollees in the form of higher premiums, co-pays or reduced benefits. [Blue Cross blue Shield] plans cover approximately 48 % of [Federal Employees Health Benefits Program] enrollees, or nearly 3.8 million Americans. Single enrollees would be subject to the effects of the tax in 2013, while families are hit in the third year. Including other, non-BC/BS plans, more than one-half of active and retired enrollees will face the effects of these taxes that accumulate to thousands of dollars in the middle to out years of the Senate-passed bill. Because we understand the value of all health care is counted towards the threshold amounts, enrollees with dental or vision coverage, or a Flexible Spending account, could reach the thresholds even sooner and feel the effects of this tax earlier.

Characterizing this tax proposal as a “Cadillac tax” is a misnomer. It hits the average blue collar and white collar employee or annuitant. FEHBP insurers will simply reduce coverage and, as the taxes increase, a downward spiral towards less coverage will ensue, which is antithetical to health care reform’s states purpose. Penalizing FEHBP enrollees with this tax is a huge disincentive to qualified applicants seeking federal or postal employment. It is bad for the government and bad policy overall.

The note to congressional leaders is the latest lobbying salvo by the labor community in opposition to the excise tax. Also on Tuesday, House Speaker Nancy Pelosi (D-Cali.) hosted several major union leaders to discuss their opposition to the provision.

The unions signing the letter are as follows:

American Federation of Government Employees
American Foreign Service Association
American Federation of State, County and Municipal Employees
American Postal Workers Union
Federal Managers Association
Laborers’ International Union of North America
National Active and Retired Federal Employees Association
National Air Traffic Controller Association
National Association of Letter Carriers
National Association of Postal Supervisors
National Association of Postmasters of the United States
National League of Postmasters of the United States
National Postal Mail Handlers Union
National Rural Letter Carriers’ Association
National Treasury Employees Union
Professional Aviation Safety Specialists

Firefighters Rip Obama For Breaking Campaign Promise Over Cadillac Tax

01.14.10

Firefighters Rip Obama For Breaking Campaign Promise Over Cadillac Tax

by Brian Beutler

http://tpmdc.talkingpointsmemo.com/2010/01/firefighters-rip-obama-for-breaking-campaign-promise-over-cadillac-tax.php

The International Association of Fire Fighters## an influential union that belongs to the AFL-CIO## has released the strongest condemnation yet of President Obama’s support for taxing high-end health insurance plans as a means of financing a major health care overhaul## accusing him of breaking a campaign promise, and threatening to hold him accountable.

“If candidates make a promise to us, we hold them accountable. We held President Bush accountable when he made decisions that had a negative impact on our members’ jobs and lives. We will do the same with President Obama,” reads a statement from IAFF President Harold Schaitberger. “In 2008, then-candidate Obama promised three things: he said he would not raise taxes on folks making less than $250,000 a year; he vowed not to tax health insurance benefits; and he promised that under his health reform plan, people would be able to keep their existing coverage.”

Now, President Obama supports the misguided excise tax passed by the Senate. The Senate bill will either subject the health care coverage provided to thousands of America’s fire fighters to a tax or those benefits will be slashed to avoid the tax….

The president’s support for the excise tax is a huge disappointment and cannot be ignored. If President Obama continues to support it and signs a bill that includes the excise tax on workers, we will hold him accountable.

The rebuke comes as Obama meets with a host of labor leaders, including AFL-CIO President Richard Trumka, at the White House tonight to sell them on his support of the tax, and find common ground.

Trumka made clear earlier today, that his organization’s top priorities in health care reform are the public option, the employer mandate, and the elimination of the excise tax. With the public option gone, and Obama still foursquare behind the excise tax, it seems evident that the country’s largest labor federation will walk away from the health care fight badly disappointed. Trumka, however, declined to say whether he could ultimately support a bill that didn’t address his top priorities.

Tomorrow evening, House Democrats, who overwhelmingly oppose the excise tax in the Senate bill, will gather to discuss health care reform at a caucus meeting. You can bet the excise tax will be a key focal point for them.

You can read Schaitberger’s entire statement below.

“The core political principle of this union is ‘we support those who support us.’ If candidates make a promise to us, we hold them accountable. We held President Bush accountable when he made decisions that had a negative impact on our members’ jobs and lives. We will do the same with President Obama.

“Throughout the debate on health care reform - even before excise tax on so-called high-cost health plans was proposed - this union made it clear to Congress and President Obama that our goal is reducing health care costs, preserving the benefits our members already have and avoiding piling more taxes on the backs of hardworking Americans.

“In 2008, then-candidate Obama promised three things: he said he would not raise taxes on folks making less than $250,000 a year; he vowed not to tax health insurance benefits; and he promised that under his health reform plan, people would be able to keep their existing coverage.

“Now, President Obama supports the misguided excise tax passed by the Senate. The Senate bill will either subject the health care coverage provided to thousands of America’s fire fighters to a tax or those benefits will be slashed to avoid the tax.

“We have made it clear to every senator and representative on Capitol Hill and President Obama that we are fully and completely opposed to this tax.

“The health care reform bill passed by the U.S. House of Representatives does not contain the excise tax, and the House leadership continues to stand with us. We applaud our House allies for their courage as they wage this battle. This union will continue to fight to keep the excise tax out of the final bill.

“The president’s support for the excise tax is a huge disappointment and cannot be ignored. If President Obama continues to support it and signs a bill that includes the excise tax on workers, we will hold him accountable.”