Here are four points:
1. Legislators and economists claim the tax will take from the rich and give back to the poor, which Steffie Woolhandler, PhD, co-author of the study, contested.
2. Dr. Woolhandler argues the tax’s long term goal is to eliminate current subsidies to employer-sponsored health insurance plans, and many critics of the tax say the current subsidies promote over-insurance, prompting policyholders to seek unneeded care.
3. Dr. Woolhandler proposes a single-pay “Medicare-for-all” system, claiming the system will improve the fairness of health financing.
4. Many employers are rising deductibles and forgoing other services to mitigate the Cadillac tax’s impact.
“The main beneficiaries of the current tax subsidies to employer-sponsored coverage are middle class families for whom the subsidies boost their effective incomes by about 5 percent,” Dr. Woolhandler explained. “These are the people who would be most harmed when the Cadillac Tax kicks in and curtails the current tax subsidies.”
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