Employers largely unprepared for 'Cadillac tax'
Many senior living operators expect to be affected by the new health law's so-called Cadillac tax. But a report from Deloitte & Touche finds that few employers have determined when the tax will hit, or taken steps to avoid it.
Only 37% of the surveyed employers have calculated their exposure to the tax, and more than a third (34%) still haven't considered doing so. Fewer than 4 in 10 (38%) have attempted to estimate the first year the tax will hit their plans, whereas 33% indicated they haven't even considered taking that step, the report finds.
Scheduled to begin in 2018, the 40% non-deductible excise tax will be levied against employer-sponsored health coverage that provides high-cost benefits. The tax will raise an estimated $87 billion over 10 years, which will help cover expanding health coverage provisions in the health law.
Critics have said the tax will harm workers because employers will adopt plans with higher deductibles. As a result, employees will be forced to pay a higher share of the cost, they say.