It is interesting to note that a significant portion of the savings—$201 billion—to be generated by the Senate Finance Committee healthcare reform plan stems from the excise tax on “Cadillac” plans currently sold by private insurers.
At first glance the tax may seem innocuous in that it will be levied against insurers and not consumers. In fact, this tax will result in a reduction in benefits for these plans, or in the alternative higher premiums.
While the plan will put in place protections for those with pre-existing conditions and expand coverage to the uninsured, it fails to get at the administrative bloat and inefficiencies that are the hallmark of the private payer system today. Without taking steps to address this issue, I fear that we are doing little more than following the path of costshifting that has already gone on long enough within the industry. David Contento Ridgewood, N.J.