Why The 40% Cadillac Health Plan Tax Will Utimately Hit Millions Of Middle Class People

Under ObamaCare, any individual health plan that costs $8,500 or more a year or, any family plan that is in excess of $23,000, will be hit with a massive 40% surcharge for being a so-called Cadillac plan.  And, in typical Democrat fashion, ObamaCare has no automatic way of adjusting these threshold numbers for inflation.  So, that means that, along with the AMT fix and doctor's fix, Congress will have to constantly pass legislation to adjust these numbers for inflation.

But, here's the thing.  Last year, the Kaiser Foundation reported that the average cost to an employer for  an individual health insurance plan was $5429.  For, a family, it was $15,073.   And, both these numbers were  an increase of 9% from the previous year. But, last year's bump of 9% was, hopefully, a one-time event; primarily attributed to some of the mandates of ObamaCare.  However, rates are still expected to rise by 5.8% per year through 2020.   What that means is that, by 2019, just 6-1/2 years from now, the "average" employer-based insurance plan in America will automatically become a Cadillac plan; subject to a 40% surcharge.  And, of course, that's an average of all employer plans.  Some more costly plans, such as private insurance and those in states like New York, will reach "Cadillac" status much earlier than 2019.

How's that for one helluva Obama tax on the middle class!


Insurance cost source: http://www.kaiserhealthnews.org/stories/2011/september/27/employer-health-coverage-survey-shows-employer-spending-spike.aspx

Cost projections source: http://healthaffairs.org/blog/2011/07/28/u-s-health-spending-projected-to-grow-ercent-annually/