I am assuming you're arguing from a perspective against the union exemption, though I can't fathom why you're characterizing it as "only" four years. It's absurd for them to enjoy the priviledge in the first place.
Your points regarding the lack of taxation absorbability on the part of insurers is another great argument for why consumers will suffer as a result of this foolish healthcare proposal in the first place.
Your third point is a point I've made to all of my friends - the fact that the tax exemption's supposed temporary nature isn't accurate, because the tax's structure avoids union taxes on a permanent basis anyway, at the expense of everyone else.
Essentially, you make a great point about how the issue really boils down to "unions should have permanent benefits, and should be able to skirt taxes on generous healthcare - and if they can't because of size, then they should be given a gift of time that everyone else shouldn't". Sounds mighty fair, huh?
Oh, and Webster666 - your statement just goes to show how every argument for fairness you make is actually pretty much an excuse to serve your pecuniary interests, which just so happen to be the interests of the impoverished, uneducated and indolent. Birds of a feather.
southbeach1500 saidSo, if you do the same exact job as your neighbor, and have the same health plan, but your neighbor belongs to a union, and you do not, you have to pay the 40% surcharge tax on your health plan and your neighbor does not.
Oh yeah, and the Amish are exempt as well.
Are you happy with this latest move by the Democrats?
Your statement is way too broad. I'll throw in my two-cents and try to break it down a little.
First of all, the exemption to union groups are only through 2018. Considering that the Cadillac Tax provisions in the Senate Bill are not scheduled to go into effect until 2014, it's only a 4 year exemption. Also, the exemption provided to ancillary benefits providers (dental and vision) is only fair since penalizing speciality health insurers for the overall cost of major medical policies will not be fair.
Second, the taxation is on the insurer - not on the member/enrollee. However, premium/deductibles will increase to compensate for the loss owed to taxation of benefits. Insurers are not able to absorb the premium tax on cadillac plans considering the small profit margin in the health industry. For-profit health insurers range from 6 to 8% in profit margin while non-profit insurers are at about 3%. Considering that the Senate Bill already includes a separate $11B taxation on the industry to be allocated based on market-share (less exemption granted due to high MLR achievements), it will be unreasonable to ask them to absorb.
Third, the cadillac tax provisions will only affect insured products, not self-insured/ERISA health benefit plans. Most unions are actually self-insured through trusts...so actually...the tax doesn't apply to majority of them. Same goes for large corporate employees. The targeted population will be mid to small groups and small scale unions that do not have the capital to be the risk-bearing entity; purchasers of insured products from insurance companies.
Fourth, the exemption is actually a smart choice since it allows for union groups with insured products to switch compensation formats from defined benefits to income-based compensation. The exemption permits the necessary lead time to make adjustments to ensure the clearing of tax and redistribution of compensation format.