I recently had a conversation with a Connecticut Congressional Representative staff member regarding the Affordable Care Act (ACA). Specifically, we were discussing the definition of small group employers, which currently means 2-49 employees, but beginning in 2016 will be expanded to 1-100. This change is receiving a lot of interest at the federal level as special interest groups look to postpone the change and/or push for the ability of each state to make their own decision. In our discussion, I shared with the staff member that I believe a greater concern, especially for Connecticut employers, will be the impact of the Cadillac Tax.
The Cadillac Tax is a 40 percent excise tax on high cost employer-sponsored health plans and is one of several financing elements of the Affordable Care Act. It is projected to generate $80-$120 billion in tax revenue and will take effect in 2018. The high cost thresholds have been set at $10,200 for individual coverage and $27,500 for family coverage. There is still final regulation work to be completed which is intended to include indexing of the thresholds in future years. Continue reading How the Cadillac Tax will Affect all Makes and Models