Unions lobby hard against Finance Committee health plan

In phone calls, e-mails, a “fly-in” of more than 100 state and local union leaders from 27 states, and studies released by the Communications Workers and AFSCME, they also reiterated that any health care plan must have a strong “public option,” a government-run competitor to the private health insurers.

Otherwise, the unionists said, health care “reform” is no reform.

The lobbying came as the Senate Finance Committee — considered the key congressional panel on health care — put finishing touches on its version of health care legislation. Other versions passed by four other congressional committees have the public option — and don’t tax workers’ health benefits.

The Finance plan, which may come to a vote by Oct. 16, lacks the public option. It includes the taxes, to help pay for the cost, estimated at up to $1 trillion over 10 years starting in 2013, of ensuring nearly universal health care coverage in the U.S.

To pay that sum, the Finance Committee would tax the amount of each family health plan that’s worth more than $21,000 yearly, and the amount of each single person’s health plan that’s worth more than $8,000. The excluded amounts would rise yearly with general inflation — which is only half of medical inflation.

The figures on where taxes start led AFSCME to state 40% of working families would get hit. And CWA issued a study showing the average family in 26 states would pay the Finance Committee’s excise taxes. The tax would be as high as $55,000 per family over a decade, starting in 2013, in Maine, Massachusetts, New Hampshire, New York, Rhode Island, and Vermont. In those same states, the average individual health insurance policyholder would get hit with $20,080 in taxes over 10 years.

In response to such taxes, CWA said, companies would likely cut costs by cutting coverage and eliminating health care for now-retired workers aged 55-64.

“The Senate Finance Committee’s excise tax, supposedly aimed at insurance companies, will also apply to employer and union health plans and be directly passed onto working families,” CWA pointed out in its fact sheet for lawmakers.

“To avoid the tax, employers will be motivated to significantly cut benefits for active workers and to eliminate coverage altogether for pre-Medicare retirees,” it added. That’s what GOP presidential nominee John McCain proposed in 2008, CWA added.

The union plans — and workers and families — that would get hurt are not “Cadillac plans,” CWA said. Vulnerable plans include multi-employer plans, a common arrangement in the construction industry. And union plans “are roughly comparable to other health insurance plans, but provide more-limited cost-sharing,” CWA noted.

In other words, the plans that get hurt — and the workers who would pay — are the plans where the firms, not the workers, pick up more of the tab.

“A good union contract that confers good wages and benefits encourages workers to stay with their employers and gain seniority, producing an older-than-average workforce” and the higher costs, the CWA fact sheet adds.

While CWA marshaled the state-by-state data against the Finance Committee’s legislation, union leaders also spoke out forcefully against it. AFSCME President Gerald McEntee called it “deeply flawed.” AFL-CIO President Richard Trumka vowed to doggedly fight attempts to tax workers’ health care benefits.

“We’ve paid for those benefits over the years” by foregoing raises and pensions, among other things, he said.

Mark Gruenberg writes for Press Associates, Inc., news service. Used by permission.