The “Cadillac Tax” on health care plans has been repealed by Congress as part of the new SECURE Act.
The “Cadillac Tax” was part of the Affordable Care Act - it provided that for any plans costing over $27,500 per year (about $2300 per month), there would be a 40% (!) excise tax on all amounts over $27,500, as of 2022.
Because Union-negotiated health plans are some of the best in the nation, this meant that these plans would have had to cut benefits or pay this exorbitant tax - the point of it was to reduce the cost of health care by putting a cap on how much plans could cost.
In part because of Labor’s battle to abolish the tax, joined in by the health care industry as a whole, Congress finally abolished it, effective January 1, 2020.
This is great news because it means Unions can continue to negotiate for so-called “Cadillac Plans” - the best plans available for working people - yet another reason to keep your Union strong.
For further information, contact your Union labor lawyers.
Author: Bill Sokol
