Congress made another change to health care reform by delaying the so-called Cadillac Tax on high-cost employer health plans. The Cadillac tax effective date has been pushed back to 2020. The tax, once paid, will be deductible by employers.
The Cadillac tax imposes a 40% tax on the cost of employer-sponsored health coverage over $10,200 for single coverage and $27,500 for family coverage. These amounts are adjusted for inflation.
Employers have largely been against the Cadillac tax since its inception. This latest round of delays and changes to deductibility is welcome relief for employers.