Health care reform's 'Cadillac' excise tax complicating labor talks

http://www.businessinsurance.com/article/20150524/NEWS03/305249983

May 24, 2015 By Karen Pallarito

The health care reform law's so-called “Cadillac tax” on employer health plans doesn't take effect until 2018, but it already is complicating employer contract negotiations with unions.

Under the Patient Protection and Affordable Care Act, a 40% excise tax will be imposed on premiums that, in 2018, exceed $10,200 for single coverage and $27,500 for family coverage. Multiemployer plans, which are collectively bargained plans maintained by two or more employers, must stay within the higher threshold, whether the coverage is for singles or families.

In April, KapStone Paper and Packaging Corp., based in Northbrook, Illinois, proposed replacing its Kaiser HMO and UnitedHealthcare PPO with two high-deductible health plans linked to health savings accounts.

Mill workers in Longview, Washington, represented by the Association of Western Pulp and Paper Workers Union Local 153, rejected the tentative eight-year contract containing the change. Health care is one of several major sticking points, as union workers' last contract expired May 31, 2014. The union would prefer to continue negotiating but has received notice from KapStone that talks are at or near an impasse.

FULL story at link.