It seems that others are finally under the realization of what I have been saying since the ACA became law. The “Cadillac” tax on health insurance may jokingly become the “Chevy” tax.
The 40% excise levy starts in 2018 on high-cost insurance coverage: those above $10,200 a year in premiums for an individual; $27,500 for families. I have clients with basic coverage which are near those levels already. When more plans switch to an age based formula this will make it easier to pass these thresholds.
The coverage ceiling for medical expenses are indexed to overall inflation, not to medical costs, which rise significantly faster, 2.4% in 2014, compared with 0.8% for overall inflation. Those stats are national averages, not Chicago area based which I am sure are higher.
So over time more moderately priced plans will bump up against the limit, very quickly. Then the penalties will fly.
Current estimates have 14% of firms will pay the tax in 2018 that will be charged. But the estimates have more than two-thirds of businesses being on the hook to pay by 2023. So that will be a nice shock to shareholders and small business owners, not to mention the employees.