The Kaiser Family Foundation estimate the Cadillac tax will have a substantial impact on employers, causing many employers to pay for a larger share of their healthcare out-of-pocket, according to Los Angeles Times.
Here are four key points on how the tax will affect employers.
1. Many of the largest employers and labor unions oppose the tax while big companies typically offer the widest range of Cadillac-taxable benefits for their employees. According to Kaiser analysts, 46 percent of companies with more than 200 employees will pay some Cadillac tax in 2018. This figure is expected to rise to 68 percent in 2028.
2. Many employers will opt to raise deductibles on health plans to lower premiums. Employers may scale back or eliminate benefits that are not mandated by law.
3. Some companies have already cut benefits and raised deductibles, attributing these changes to the Cadillac tax. However, some individuals believe employers are using the tax as a scapegoat and are cutting benefits as a way to cut payroll costs.
4. The Cadillac tax may never be implemented in its current form because of opposition from unions and big companies. Additionally, the tax may create inequities within companies because some employees may choose packages that exceed the threshold while others choose less costly packages.
More articles on coding & billing:
10 things to know about price transparency
Don't risk your health subsidies, pay your taxes — 5 things to know
Frontier Capital invests $16M in Aviacode — 4 key points