WASHINGTON, Jan. 16 (UPI) -- U.S. House-Senate talks on a bill to overhaul the U.S. healthcare system reached a key milestone with an agreement on "Cadillac plans," labor leaders say.
AFL-CIO officials said Friday negotiators have agreed to soften the blow to millions of union members who will be hit by a tax on their expensive health plans, giving a five-year reprieve on the tax to as many 12 million such policyholders, The Wall Street Journal reported.
The newspaper quoted union officials saying the tax would be phased in and would exempt workers in collective bargaining agreements, as well as state and municipal government workers, until 2018, costing $60 billion in revenue over a 10-year period.
Under the agreement, non-union workers with expensive health plans would reportedly begin paying the tax in 2013.
The Journal said language in the Senate version of the reform bill had called for health insurers to pay a 40 percent tax on premiums exceeding $8,500 annually for individuals or $23,000 for family plans, which would have affected 19 percent of existing policies. But, it said, agreement raises those thresholds to $8,900 for individuals and $24,000 for families, thus affecting fewer workers.