A New Group Health Insurance Tax Possible On Employer Benefits

A New Group Health Insurance Tax Possible On Employer Benefits in Group Health Insurance

Today’s big health insurance reform news is that President Obama is officially open to new taxes on employer health benefits.

It’s a gigantic leap away from what the president’s message during the 2008 campaign, in which he criticized any thought of a brand new tax on group health insurance and he promised no tax increases for middle-class Americans.

Unfortunately for Middle America, any tax on employer health insurance would hit them square in the nose.

But times have changed. Obama is now president, the 2012 election is still more than 3 years away, voters have short memories, and most of the proposed health insurance reform plans are estimated to cost $1 trillion-plus.

Obama’s senior advisor David Axelrod told ABC’s George Stephanopoulos that the White House won’t be “drawing lines in the sand” about where they’re going to get the money for reform, and taxing employer benefits could be a possibility, wrote the Washington Post.

As McClatchey Newspapers reported, however, President Obama isn’t so keen on the idea. As a compromise, the president is considering taxing only health insurance plans with Cadillac-like coverage, obviously in attempt to aim these potential tax hikes at higher earning Americans.

Politically, such a decision could significantly hurt President Obama’s credibility, but could also be necessary to pay for a massive health reform bill.

On the other hand, the president and his advisors have been shockingly brilliant when it comes to snaking their way out of tough political situations. After the way the president has handled his politics in the past, we wouldn’t be surprised if he could pull this one off.

We shall see.

Comments[0]