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Sloan points out that proponents of the tax define "Cadillac Plans" not by the benefits provided but by the cost, and they imply that the cost is based on unnecessarily cushy benefits. But any insurance expert will point out that cost depends more on the people being covered (old, sick, or both) and location (high-cost New York or low-cost Montana). For example, Medicare (which wouldn't be subject to the tax) is expensive because it covers the elderly and disabled, not because its benefits are generous. Remarkably, today, December 22, 2009, the Washington Post ignores its well-informed columnist and asserts that "The tax on high-value insurance plans, endorsed by health economists of every ideologal stripe, would bring the dual benefit of helping pay for reform and imposing a brake on rising prices. It is far preferable to the surtax on high-income individuals contained in the House measure." The Post doesn't bother to offer any justification for opposing the surtax on high-income individuals. Perhaps its reasons are ideological. Yet the paper complains almost daily that the nation is running up an intolerable deficit, usually implying that "entitlements" are out of control. Raising taxes during a recession is problematic for most people, except for those who are making out like bandits, despite hard times for everyone else. I can think of no group except the wealthy that can easily afford to pay higher taxes at this time. Back Comments
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On December 18, 2009, Allan Sloan, the Washington Post's respected business columnist explained why the Senate's idea to apply an excise tax on 'Cadillac Care' health plans rests on myths about costs.