By Benjamin Day, Healthcare-NOW! Director of Organizing –
Yesterday, the New York Times reported that the Affordable Care Act’s “Cadillac Tax” will accelerate the erosion of quality health insurance as employers demand higher copays and deductibles from their workers to keep their premiums low enough to avoid the tax.
While the Times is correct about the dangers of the tax, they are perpetuating inaccuracies about who will face the tax and how employers are trying to avoid it.
The Times inaccurately states that the tax “penalizes companies that offer high-end healthcare plans to their employees.” The tax, starting in 2018, actually penalizes plans with premium costs above $10,200 for individuals or $27,500 for families.
However, your premium costs have almost nothing to do with how good your coverage is, or whether you have a “high-end” plan or not. A 2009 Health Affairs study found that the quality of insurance coverage explains only 3.7% of the variation in premiums.
This means the tax will not be hitting those with good health coverage, but rather older patients (who can be charged up to three times what younger patients are for the same coverage), and those living in states with expensive hospital care. The term “Cadillac Tax” itself is inaccurate and misleading, and the Times should not be perpetuating this myth.
A major theme of the Times’s article is that employers will try to keep their premiums down by keeping their employees healthy, through “wellness” programs that create financial incentives for healthy behavior (such as smoking cessation, weight loss, etc). A number of recent studies show that these programs are not effective at reducing healthcare costs, and in reality they are a way for employers to shift costs onto workers with chronic illnesses or disabilities by charging them higher premiums or withholding benefits.
Join me in writing a letter to the editor of the New York Times asking them to stop perpetuating the myths of the “Cadillac Tax” and “wellness programs,” and reminding them that a single-payer health plan would take the burden of healthcare costs off of employers and give all workers access to comprehensive coverage – with no cost sharing – while reducing our healthcare costs. Painful tradeoffs like those that will be created by the Affordable Care Act’s tax on high-premium plans are unnecessary and immoral with a proven alternative like single payer reform.
You can submit a letter to the Times by emailing firstname.lastname@example.org. Letters can be no longer than 150 words, must refer to an article that has appeared within the last seven days, and must include your address and phone numbers. No attachments.
For inspiration, here’s what I submitted to the Times:
In its May 27 article (“High-End Health Plans Scale Back to Avoid ‘Cadillac Tax’”), the Times perpetuates the myth that the Affordable Care Act, starting in 2018, will tax “high-end health care plans.” In reality it will tax plans with high premiums, which are not those with the best coverage but rather those offered to older people (who can be charged three times the premium of younger patients for the same coverage) and those living in high-cost states. A 2009 Health Affairs study found that only 3.7% of differences among premiums could be explained by how good their coverage was. The term “cadillac tax” is misleading and should be abandoned by the Times. The tragic consequences outlined by the Times – rising deductibles and copays – are all too real, though, and unnecessary given that single payer health reform could extend comprehensive care to all residents while reducing our spending.
For a better chance of being published, please don’t copy this letter word for word.