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House passes Cadillac Tax Delay

Early Wednesday (Dec. 16th) morning, the House of Representatives passed legislation that would postpone the Cadillac Tax until 2020, which was supposed to take effect in 2018. Since the passage of the ACA in 2010, many schools, cities, and counties across the nation have been planning to redesign and negotiate plan changes in order to reduce their health insurance premiums before the Cadillac Tax went into effect. Now that the House of Representatives have voted to delay its implementation by two years, this could give schools, cities, and counties additional time to design new plans and come up with modifications.

Even though the Cadillac Tax has been delayed by two years; schools, cities, and counties still need take measures to decrease the overall costs of their health plans. For more information, read 5 Ways to Bend The Health Insurance Cost Trend.

The Washington Post reported that delaying the tax for two years could cost the government an estimated $9 billion in revenues. The congressional Joint Committee on Taxation estimated that Cadillac Tax would have generated $2.2 billion in 2018, $7.2 billion in 2019, and afterwards would have ballooned to an estimated $91 billion by 2025. However, according to Kaiser Family Foundation, deferring the tax for two years will have minimal effect on revenues, the law, and health care costs

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Erin Woulfe
Erin Woulfe
Erin Woulfe likes to write about things that matter. Keeping her finger on the pulse of what’s happening in the public sector world, she blogs about the latest legislative news and employee benefit trends that affect our school, city and county clients. She’s been with NIS since 2002. “I love connecting to our clients and providing them with the tools they need in order to administrate their plan,” says Erin. “Whether that be materials to educate their employees on certain benefits, how to effectively communicate change within an organization or just providing tips and how-to’s to help them make their job easier.”

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