Unions could get Obamacare exemption

If you are a member of a labor union you might be able to get an exemption and keep your health insurance even while millions of other Americans are losing their health plans.

Earlier this summer big labor pressured the Obama administration to give their members special subsidies in order to keep their high end plans without paying a penalty. Recent news coverage has focused on how millions of Americans are receiving notices that their insurance plans are being cancelled because of Obamacare. Among those receiving cancellation notices are congressmen such as Colorado Rep. Cory Gardner who showed Health and Human Services Secretary Kathleen Sebelius a copy of his cancellation letter during a recent hearing.

The administration has been justifying the cancellations by saying the plans were substandard and Obamacare requires plans to have more generous benefits. However, under the law a person can also be penalized for having a plan that is too good.

Under the Affordable Care Act, those who have so-called Cadillac health care plans are subject to a 40 percent excise tax beginning in 2018. These plans typically have little, if any deductible and the employer pays the majority of the premium, resulting in little to no cost to the employer.

However, union members have protested the tax saying these plans are primarily owned by union members who have negotiated the plan as one of their benefits.

Earlier this year, the administration announced that unions would not be getting a special exemption from the tax, despite pressure from labor officials. The announcement came at the same time the administration was facing criticism for granting special exemptions to Congress to pay for their healthcare through the exchanges, regardless of income.

However, it now appears the administration may be quietly drafting rules to grant labor unions their exemption after all.

A report form Kaiser Health News is saying that buried in the midst of a series of rules issued last week is a disclosure that the administration will be proposing exempting some union plans from the tax.

The report notes that “the administration will propose exempting ‘certain self-insured, self-administered plans’ from the law’s temporary reinsurance fee in 2015 and 2016.”

It goes on to note that insurance companies and self-insured employers who hire outside claims administrators would still be required to pay the tax, making union members the primary beneficiary of the new rule.

Unions, a key ally of Obama, have long criticized Obamacare for threatening the generous healthcare plans they currently possess and have said they want their plans waived.