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Health Care Tax: Union Leaders Outline Big Improvements for All Working Families
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Following two days of intense negotiations at the White House, union leaders believe they are on the verge of winning significant improvements for working families in the pending health care reform legislation.
In a conference call this afternoon with leaders from AFL-CIO unions, Change to Win unions and the National Education Association (NEA), AFL-CIO President Richard Trumka told reporters the final health care bill he expects to emerge is ”a milestone.”
“We’ve been fighting for health care for over 60 years, and we are on the threshold of a significant achievement….But we don’t look at this as the end of the fight, but another step in the quest for real reform.”
The discussions with the White House envision major changes for all working families in the excise tax that the Senate bill imposes on high-cost health care plans, including:
- Raising the threshold at which family plans are taxed from $23,000 to $24,000 in 2013 for all working families, with annual increases of Consumer Price Index plus one. The threshold for single plans will be $8,900. (Taft Hartley plans will be considered at the family rate.)
- Raising the threshold on plans further if health care costs grow faster than expected from 2010-2013.
- Exempting dental and vision costs beginning in 2015, which could raise the threshold as much as $2,000.
- Raising the threshold for plans that have significant numbers of women and/or older workers.
- Preserving the original Senate proposal to raise the threshold for plans with workers in high-risk professions, affecting more than 9 million workers.
- Preserving the original Senate proposal that would raise the threshold for plans with retirees age 55 and up.
- Providing transitional relief for employers and workers to adjust to the tax.
- Temporarily raising the threshold for high-cost states, affecting more than 38 million workers.
- Providing a five-year transition window for state and local employee plans and plans negotiated through collective bargaining agreements before they are subject to the tax, as typically is done when federal laws affecting workers are enacted so that agreements will not have to be renegotiated.
- The ability for bargaining plans to go into the exchange in 2017.
NEA President Dennis Van Roekel said:
The progress we’ve made bolsters our belief that a nation as great as America can provide health care reform without unfairly penalizing our working families in the process.
There are several other areas still to be resolved before a final bill is achieved, including employer responsibility to pay a fair share of health care costs. As Trumka said today:
We’ve seen tremendous progress over last couple of days, but we are continuing the fight to increase our priorities in the health care reform bill.
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30 Comments
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I’m proud of the work union members and our leadership did to move this Bill. Keep up the good work everyone!
The AFL-CIO Leadership and the White House
“The Back Room Deals” Tapes have finally surfaced.
I wish this was even exaggerated, but sadly its not.
AFL-CIO:
“No one in America Should go without health care”
White House:
—- SCRATCH THAT!
Ok… how about a “robust” public option! We won’t support any bill without that!
—- SCRATCH THAT!
OK… Allright… We won’t support a bill without a weak public option! That’s right membership, that’s what you should support!
—- SCRATCH THAT!
Hmm… ok… the health care bill must have “the basic principle” of a “public option”!!! This is real reform!
—- SCRATCH THAT!
No public option? Damn… the White House says we can say the public option is a good thing still, right? Here’s the new rallying cry: “Real health reform, with NO TAXED BENEFITS!!! and, a public option would be cool, you know, if you don’t mind…”
—- SCRATCH THAT!
Hold your brakes here, this “Cadillac Tax” won’t work. We won’t draw a line in the sand or anything, but let’s just say we’ll have a hard time supporting your health care bill. A lot of members might not vote Democrat next election, even when we tell them to… Besides, you promised us EFCA! You PROMISED!
—– LET’S MAKE A “COMPROMISE”
So in exchange for keeping single payer off the table (besides an unenforced resolution at our convention), ditching the demand for any type of “public option” or any DEMANDS at all, we will continue to call your bills “reform” and tell our members to donate, volunteer and vote for Democratic candidates in 2010 and 2012. Well, except maybe Kucinich and Massa.
We’ll soften the blow by allowing a DELAY of a few years in taxing benefits, and we promise we’ll never campaign against that again.
We can focus on the Republicans and their policies of war and wall street and bank bailouts and….
—- SCRATCH THAT!!!!!!!!
Please do not tax beneffits.This Turkey will cost us the majority. I 2010.Where is the Healt Care savings?
@ Rank n File – You are the best with that unfortunately all too real HCR “transcript.” Made my day! I’ll post it as a note on my facebook page… really great stuff!!!
John O’Neil, a single payer HR 676 supporter and union member
Always glad other union brothers and sisters see the truth!
FYI- A critical opinion that challenges Mr. Trumka’s “milestone.”
Posted on CommonDreams.org :
http://www.commondreams.org/view/2010/01/14-12
Published on Thursday, January 14, 2010 by FireDogLake.com
Union Exemption from Excise Tax is a Bad, Bad Idea
by Michael Whitney
Jane explained last night that unions have a tentative deal for a way out of the excise tax: exempting health care plans protected by collective bargaining agreements. That means union plans that cross the $23,000 threshold won’t be taxed.
TPM backs up this story with Rep. Rob Andrews explaining exemptions for the excise tax may pull together enough votes to pass:
As I first reported yesterday, one idea gaining traction in negotiations between Congressional leaders, union officials, and the White House is that collectively bargained benefit plans could be exempted from the tax. According to Rep. Robert Andrews (D-NJ), who chairs the health subcommittee of the House Education and Labor Committee, that could be enough to build a majority for health care reform.
“It would be a way to lessen impact of the so-called excise tax,” Andrews said. “I think we could build a consensus around that idea–a majority around that idea.”
If unions take this deal, it’s a sell-out of epic proportions. I’m hard pressed to think of a deal unions could cut in health care that would cause more long-term damage to not just the credibility of the labor movement, but to the middle class itself.
The excise tax is a tax on more expensive insurance plans that is supposed to fund part of health care reform. It was branded the “Cadillac tax,” but that distorts the reality of who it will effect. This isn’t a tax on the rich; it’s a tax on the middle class, the old, and the sick with more expensive plans. And a good chunk of those plans are negotiated under collective bargaining agreements, i.e. under union contracts.
Richard Trumka laid down a line and said the AFL-CIO would not support a plan without a public option. While other labor groups haven’t been as forceful, progressives have looked to the AFL-CIO as the most defiant of the veal pen.
Presumably, in Monday’s meeting at the White House, labor leaders made clear that the excise tax on their plans wouldn’t fly, and that the Employee Free Choice Act would have to come up for a vote (and pass?) in a few months after health care. And I’m sure they got the same assurance they’ve got from Rahm and Reid for more than a year on labor law reform: be patient, it will come up and pass.
If unions take this “deal,” if the labor movement decides to fold and exempt themselves from the excise tax, they fulfill one of the worst of stereotypes of labor unions: blind self interest. By abandoning the nonunion middle class and protecting only their own, the labor movement is throwing any hope of future relevancy out the window.
The ideal of unions is to organize the unorganized, to protect the unprotected. Sure, unions should fight for their members, no question. But in the biggest public policy and political fight of a generation, unions simply cannot exempt their members from the dangerous excise tax and call it a day.
And if Rahm does come through on his end of the deal – a vote on the Employee Free Choice Act – expect unions to be very much on their own in that fight if they sell out on health care.
This deal has RESENTMENT WRITTEN ALL OVER IT. This will not grow the Labor movement because it’s yet another example of “we got ours, too bad for you.”
If President Trumka had followed the unanimous vote of the AFL-CIO Pittsburgh convention delegates, and vigorously supported the “single-payer” Medicare-for-All demanded by his own union, then a true “milestone” would have been reached.
That “milestone” might have indicated that the desperate hope of millions for real “change”, that Obama and the Democrats have so cynicallymanipulated and finally ignored, would at last start to happen.
A “milestone” to show that President Trumka is a true leader: a leader who understands what is happening and acts upon that understanding. A leader who breaks with Obama, the Democratic Party, and all the capitalist economic interests that are looting and destroying the economy and the working people of this country.
Mr. Trumka, and the other labor “leaders” supporting Obama’s “Health Care Reform”, have indeed reached another “milestone”.
i
President called on Congress to make sure that the final bill included three provisions, Public Insurance Option, No excise tax on worker healthcare benefits and an employer mandate so employers pay their fair share.
Despite all the Corporate Lobbying and back room shenanigans in Senate, we have persistently stood behind President Trumka’s statements. Our last stand was that on these key issues the House bill provisions be put in the Final bill.
Only a couple of days back as part of the National Pledge Day we all called upon members of Congress to push for our agenda, especially on PO and Excise Tax.
It is very good news that President Trumka has reached a deal with Whitehouse and Congress winning major changes for all working families in the excise tax that the Senate bill imposes on high-cost health care plans. Trumka says that despite this success we are continuing the fight to increase our priorities in the health care reform bill. The most important one has been the Public Option to compete with private insurance companies to lower the cost of insurance. I feel that if the cost comes down, it will enable the employers to pass on this on to workers as higher wage raise.
The other bug issue is the employer mandate to insure that employers pay their fair share of Health Care costs.
I hope that President Trumka, in exchange for the concessions we have made on Excise Tax, can extract a win on another key item namely the Public Option, out of President Obama.
So the unions will go back to supporting this disastrous plan now that they won’t be helping to pay for it.
Way to go, guys! That will really endear you to the American people!
I am not sure what to think except there shouldn’t be any tax on any benefits at all. not tax at all would have been a true milestone!
congrats to the dems, finally gave into demands of GOP yet again. Yes, Gop had pipe dream of taxing benefits since the second world war and they win yet again by default. Historical is right.
Seems “our friends, the dems” have yet again struck at working folks again. Did McCain win last election? Odd, I think I voted against him and iceprincess Sara. One major reason: “Taxing medical benefits”.
Something I will remember at ballot box in 2010 and 12
I have to commend the union for having the integrity and wisdom to provide this forum for member comments. Although many of these submissions have been highly critical of union actions and positions, they are a true reflection of the feelings of and offer a valuable insight to the thoughts and concerns of at least some of our membership. Issues and ideas should stand on their own merit and not be judged by how popular they may be. The free exchange of ideas offers a means to achieve the best outcomes for everyone.
I wonder how many of you remember when family doctors made house calls. Remember when you could find a family doctor? It was a time when a visit to an emergency room got you immediate treatment without the need for filling out a pile of paperwork. The quality of care was the same regardless of the type of health insurance (if any) you had. In those days most routine hospital bills could be paid out-of-pocket.
What happened? What went wrong? The short answer is: government! The politicians legislated, procrastinated, and abdicated their responsibility for the current mess. And now we want to believe that this same clueless bunch will come up with a master plan for healthcare?
Let’s stop fooling ourselves and ask the great minds in Washington to explain why we are in this mess. If they can’t or won’t provide an honest explanation for how these problems were allowed to develop, they certainly shouldn’t be trusted to provide us with a massive and expensive “cure”. Before you can fix anything, you need to know exactly what is broken and why it broke. When I hear about compromises being made to healthcare legislation just to get it to pass, I hear politics as usual. Health care should be based on good medicine, not politics!
Wake up and stop falling for all the promises the politicians are making. Stop believing in the Robin Hood idea of taking from the evil rich to give to the poor. If you enjoy the benefits of a good job, you are or soon will be among the “rich”. There are more serious threats to our well being than health care reform looming in the future such as the Alternative Minimum Tax. That lump you may soon feel in your pocket will be the fist of the IRS.
I am a proud ex union member but I believe the union leadership will be making a big mistake selling out the non union working class families. The unions and the president are trying to hide the fact that only union healthcare plans will be protected from higher taxes. The union leadership should hold there ground against this bad healthcare plan it is bad for America and especially bad for the middle class working families that buy and purchase union made products. I am so afraid this will be the beginning of the end for unions if they join congress and the president in selling out the American people just to benifit themselves. The American people are watching and will turn against union made products and companies in the future if our union leaders follow through with this agreement. Unions should do everything they can for their members but they do not have to sell out America doing it. Please save our unions and all of America and fight this crippling healthcare bill to the end. I hope that I can continue to be a pround ex union member today, tomorrow and forever!
Thanks and GOD BLESS AMERICA and OUR UNIONS!!!!
agreed. Unions need to stick up for ALL working people, union and non-union. No Tax on benefits! Tax the wealthy who have increased their wealth over the years at our expense.
I think this whole Cadillac insurance deal is just one more form of corruption on behalf of the Unions. They threatened the law makers just the other day. I don’t buy the contract crap floating around as an excuse. They could extend an exception to all and be fair. They can trump the contracts too.
So, for all of you out there that feel slighted consider this, we have money too. I have five vehicles out in the front yard, well four now my daughter is up at college. All these vehicles are union made, even the Mazda has a sticker on it. I really like that car and was going to replace it with another one. Not now, I will not buy any more Union made cars. If they come out of a Union factory I will look elsewhere. I can buy Toyota trucks they not union made and for the cars we have lots of choices. Though I like the Mazda and our Fusion. I’m not putting my money into a corrupt system.
Good Luck,
I’m not sure I understand what your talking about. It isn’t just the autoworkers plan that gets exempt from the tax. And, the “caddilac” tag means many other union and non-union plans out there. Don’t penalise the rank and file with limited information filtered to them, for the actions of jerks at the top that don’t listen, and only feel accountable when a vote comes up.
ChicanoWobbly on 15.01.2010) is right, everyone I talk to wants H.R. 676, no-one wants the crap were getting right now. As far as auto workers go, it would be much more of a competitive advantage, the Ford Claycomo plant out here has union nurses in house, I’m feel reasonably sure Toyota does not. They want equal access to healthcare for everyone without the penalties for what should be a human right.
I think people need to remember that this garbage can be repealed and replaced with Medicare For All. It wouldn’t be easy but I think many would be on board.
I am glad to see unions protecting union members. The exemption for collectively bargained plans shows everyone that labor has clout for a change. Tell me when we were even involved in the conversions at the white house in the last adminisration? Is this bill what we want? Probable not but it is better for labor and the 40 million people not insured today than the status quo that the rebublicans want us to keep in place.
Jim H… think again. Let me start by saying that I have nothing against unions. My father and most of my uncles were all union workers. However, I am in sales and not a union member. I have been following this Health Reform process very closely and I am completely against this attempt to shove something down people’s throats. But, I’ll tell you what finally did it for me… now unions want to be exempt from the so called “Cadillac” health plan tax??? I have a wife, 3 daughters, a mortgage, car payments, etc (just like you). So why should unions be exempt and the rest of the working class people pick up the tab on this scam? Here’s what I will tell you… I have always driven American union made vehicles. However, if this exemption is part of any Health Care Bill, I will make sure that I never purchase another union made product again, starting with my car, will not stay in any union hotels, etc. etc. etc. I am encouraged to see that some union members on this blog recognize that this will turn people against the unions and I believe will hurt the labor movement (not help it). You should encourage your leaders to re-think this strategy.
Single Payer is the only real FISCAL and MORAL solution for our
health care problem.
Labor should take the offensive approach and demand an eoonomic analysis of either HR 676 or S. 703 for:
– creating jobs once the employment/benefits connection is removed and workers can move to other jobs or retire and i
–increasing REAL wages once bloated employer premiums are no longer part of the wage compensation package.
Single Payer would mean more jobs and increased REAL wages.
This would be a true Labor victory for ALL working men and women.
Sea star RN
The fact is that over 550 labor organizations across the nation endorsed H.R. 676, Medicare For All. Why have these endorsements been ignored by the Executive Board of the AFL-CIO? President Obama received $20 million from the healthcare cartel for his bid for president in ’08. This explains why he did not support Medicare For All, much less the public option!
Workers do not need to pay additonal taxes! We are barely getting by as it is! The rich were given tax cuts by Bush and this needs to be rescinded! We are wasting over a billion dollars every week on wars that are 1) unwinnable, 2) unnecessary, 3) immoral, 4) and for the most part illegal! CUT THE WAR BUDGET!
This is a big win for Republicans who got their version – sure to be quite unopular – all the while ensuring that the Dems get the blame by voting against it. This is a big win for the insurance companies and legal drug pushers and a big loss for everyone else, especially workers and organized Labor. Get ready for President Sara Palin and Vice-President Joe the Plumber.
YOU PEOPLE JUST DON’T CARE HOW MANY OF YOUR FREEDOMS AND LIBERTIES YOU LOSE AS LONG AS THE GOVERNMENT IS PAYING FOR IT!!!
Page 50/section 152: The bill will provide insurance to all non-U.S. residents, even if they are here illegally.
Page 58 and 59: The government will have real-time access to an individual’s bank account and will have the authority to make electronic fund transfers from those accounts.
Page 65/section 164: The plan will be subsidized (by the government) for all union members, union retirees and for community organizations (such as the Association of Community Organizations for Reform Now – ACORN).
Page 203/line 14-15: The tax imposed under this section will not be treated as a tax. (How could anybody in their right mind come up with that?)
Page 241 and 253: Doctors will all be paid the same regardless of specialty, and the government will set all doctors’ fees.
Page 272. section 1145: Cancer hospital will ration care according to the patient’s age.
Page 317 and 321: The government will impose a prohibition on hospital expansion; however, communities may petition for an exception.
Page 425, line 4-12: The government mandates advance-care planning consultations. Those on Social Security will be required to attend an “end-of-life planning” seminar every five years.
Page 429, line 13-25: The government will specify which doctors can write an end-of-life order.”
HAD ENOUGH???? Judge Kithil then goes on: ” Finally, it is specifically stated this bill will not apply to members of Congress. Members of Congress are already exempt from the Social Security system and have a well-funded private plan that covers their retirement needs. If they were on our Social Security plan, I believe they would find a very quick “fix” to make the plan financially sound for the future.”
This thing just needs to end! No good can come from this over reaching boondoggle! I believe that if this thing goes through, sooner or later there’s gonna be a different administration in power. And when they need to raise funds to keep this mess alive,where do you think their gonna go?
Through this thing out and start over. Keep it simple,start with doing what you have to do to make it more accessible and more competitive,and it will become more affordable all on its own.
At first blush one would surmise that the few needed GOP and “Blue Dog” swing votes would not vote for a bill that includes the concessions President Trumka is trumpeting. Not so fast, this could very well fly because both the GOP and Blue Dogs understand the “poison pill” that is concealed within, and that is
yet another example of Labor “we got ours, too bad for you,” accompanied by a huge dose of resentment and yet another boost for the “right to work states” mentality.
HR-676 was the way to go and would have been a major boost to organizing efforts not to mention a much smaller dent in our wallets for heath care visa vis contract negotiations.
IF we only had real leadership…..
With all the wind in Obama’s sails after the election, single-payer was there for the taking. Just think of how mobilized we would have been if the Republicans in sheeps clothing we dutifully voted for could recognize a principled position if it bit them in the ass. Money talks, and unions walk (if they’re not too intimidated). Now, those few members willing to respond to your call to mobilize around this 1/8 of a loaf only do so half-heartedly, as if to say ” Well, we have to support this crap because it is all the rich and their puppets in DC will let us have for now.” How inspiring. Now all of Obama’s flowery speeches during the campaign are just that.
I think it’s great that unions won’t pay the tax,and here’s why: it’s a backdoor Employee Free Choice Act. While initially non union members will resent it, they will soon realize that by joining a union, they won’t have to pay either! This will make organizing which has been a major goal of unions but largely unsuccessful, much easier. It’s a major victory for unions if it’s in the final bill.
the unions will pay the tax in a few years like everyone else. to avoid the tax in the mean time, benefits will be cut and co-pays will go up. And that is some change you CAN believe in.
as far as EFCA, don’t count on it, at least in its original form. the dem’s scrapped card check with no protest from labor. that’s not good enough for the union busters, so count on more concessions in the way of binding arbitration and and increased penalties for targeting union supporters. You won’t hear about those changes here, but a bill like that might squeak through. And then that “victory” will be used to support the dems again this year and in ’12.
We had a very great opportunity after the last election. The president should have hit the ground running to get the things passed he campaigned and promised to do.. After talking about healthcare reform for over 30 years you would have thought the Democrats would have had a plan to put in action as soon as the election was over. After being elected they didn’t seem to have a clue, and just kept wasting time. When they finally got around to health care , no one knew what it was going to contain. Whenever the president , or members of congress were asked questions, they would only answer questions they wanted to answer. Never anything which might have appeared to be negative. This just provided the opening for the right wing Republicans to start their lies and innuendoes. This really confused people and they couldn’t get good answers to their questions
Myself and most other Democratic voters expected some kind of public option health plan to cover every one. Something on the order of Medicare. But as things progressed , it just went from bad to worse, and eliminated most of the things that would really benefit Americans.
The AFL CIo said they were going to stand firm for the public option , and to stand against the excise tax on workers benefits. We now know the AFL CIO cave in on this. They should have stood firm on this, and not allowed taxes on anyones benefits, union or non union. There is nothing to be gained for working people in this. You can bet that the Employee Free Choice bill will never come to pass. The same so called Democrats who gutted healthcare reform will never vote to allow people to join unions freely. They are really just Republicans in disguise.
I feel we need a whole new political party dedicated to working for average ordinary Americans I don’t know how this could ever happen. If you can’t depend on unions to make a stand and stick to it for working people, who can you depend on.
I feel that many of the things Americans had hoped to change for the better will never happen
Thank you