Friday, December 11, 2015

Three Out of Four US Employers to Be Hit With Cadillac Tax by 2022

 From Yahoo Finance:
Many employers falsely assume that the Cadillac tax will apply only to the richest plans. However, newly release data from the 2015 UBA Health Plan Survey shows that even the lowest quality "Bronze-level" health insurance plans on the Affordable Care Act (ACA) exchanges are at risk of triggering the tax, potentially affecting 74 percent of employers by 2022. ...
United Benefit Advisors' Health Plan Survey, the nation's most comprehensive benchmarking survey of employer-sponsored health plans, includes responses from more than 10,000 employers that mirror 99 percent of American businesses. 
The Cadillac tax, which takes effect in 2018, will levy a 40 percent tax on health insurance plans that cost more than $10,200 for individuals and $27,500 for families. The excise tax is not currently based on benefit levels, but is solely based on annual premiums. Current regulations also will include employer and employee contributions to Health Reimbursement Arrangements (HRAs), Health Savings Accounts (HSAs) and Flexible Spending Accounts (FSAs). (UBA does not include these amounts into the trend increases below.) 
Using a six percent rate or "trend" increase, compounded each year, UBA finds that by 2018, 30 percent of employers will be subject to the Cadillac tax; by 2020, 50 percent; and by 2022 it will hit 73.79 percent of employers. ...