WASHINGTON, D.C. | November 7, 2013
The Obama administration may have an early Christmas gift for their Big Labor friends.
In recent months union leaders have repeatedly voiced their concerns with President Obama’s health care law. At a September convention in Los Angeles, members of the AFL-CIO approved a resolution describing the health care law as “highly disruptive” to multiemployer health care plans. The Obama administration flatly rejected union demands to extend premium tax credits to individuals in multiemployer health plans, but reports surfaced that the administration could be considering other ways to address union complaints.
The House Education and the Workforce Committee is conducting oversight of the Obama administration’s rumored plans to address Big Labor’s concerns. However, to date the administration has failed to respond to the committee’s inquiry – and now the Washington Post reports the president may soon propose a special union bailout:
Weeks after denying labor’s request to give union members access to health law subsidies, the Obama administration is signaling it intends to exempt some union plans from one of the law’s substantial taxes.
Buried in rules issued last week is the disclosure that the administration will propose exempting “certain self-insured, self-administered plans” from the law’s temporary reinsurance fee in 2015 and 2016.
That’s a description that applies to many Taft-Hartley union plans acting as their own insurance company and claims processor, said Edward Fensholt, a senior vice president at Lockton Cos., a large insurance broker.
Insurance companies and self-insured employers that hire outside claims administrators would still be liable for the fee, which starts at $63 per insurance plan member next year and is projected to raise $25 billion over three years.
Unions, a key Obama ally, have increasingly criticized the Affordable Care Act as threatening the generous medical plans held by many members.
Eliminating the reinsurance fee was one of several resolutions adopted at the AFL-CIO’s September convention, along with giving union plans access to ACA tax credits for lower-income members.
In September the White House said the law disallowed health law tax credits for union members on top of their company insurance. Now the administration seems to be moving toward part — but not all — of what labor wants on the reinsurance fee.
While it intends to waive the fee for 2015 and 2016, unions also wanted it scrapped for 2014, when it will be the greatest. Taft-Hartley plans are collectively bargained and run jointly by unions and employers to allow workers to move from job to job without losing coverage.
The AFL-CIO did not respond to a request for comment.
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