Washington Times (08/25/15) Tom Howell

The Affordable Care Act’s “Cadillac tax” will impact one in four employers that offer health care benefits, the Kaiser Family Foundation says in a report being released today. Approximately 26% of companies will be affected by the tax when it takes effect in 2018 and 42% of employers will be paying the levy a decade later, signaling just how quickly health care costs are expected to rise, the report states. Kaiser said some employers probably will cut back on the scope of their plans to duck the tax, resulting in coverage with higher deductibles or networks with fewer doctors.

Formally known as the high-cost plan tax, the provision is a 40% excise on the cost of health care coverage above $10,200 for an individual and $27,500 for a family, although those amounts could change when the government issues final regulations for 2018 and as it indexes the thresholds for inflation in later years. Labor unions, which generally back Democrats, have balked at the tax. They say they often negotiate for better health care plans instead of higher wages and now will have to grapple with benefit cuts because of government pressure.