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Two-year 'Cadillac' tax delay may signal repeal later
Dec. 16, 2015
Shelby Livingston, Business Insurance

Republican Senate leaders Tom Barrasso, R-Wy., John Thune, R-S.D., Senate Majority Leader Mitch McConnell, R-Ky., and John Cornyn, R-Texas, hold a news conference on budget negotiations on Capitol Hill in Washington on Tuesday.

Congressional leaders have unveiled a $1.1 trillion budget deal that would delay the controversial “Cadillac” tax by two years — a major win for business groups and employers that have called for its repeal.

The spending deal unveiled late Tuesday would push the start date of the excise tax from the current 2018 to 2020.For many, that is a sign that a full repeal is on its way. The “Cadillac” tax imposed by the health care reform law would impose a 40% excise tax on the part of group health plan premiums that exceed $10,200 for single coverage and $27,500 for family coverage.“We see the two-year delay as a down payment on a full repeal,” said Katy Spangler, Washington-based senior vice president of health policy at the American Benefits Council, which has called for the tax's repeal on behalf of hundreds of large employers it represents.According to the council, the excise tax would increase employer costs and reduce access to care.“It gives Congress and the administration more time to work on the repeal and evaluate the potentially negative consequences of the tax,” said Steve Wojcik, Washington-based vice president of policy at the National Business Group on Health, which he said applauds the delay.

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