Public option again gains steam; Cadillac tax would fall equally on non-union plans

The public option is gaining steam again, while a new study on the "Cadillac tax" suggests it would fall equally on union and non-union health plans.

"The recess week ended up providing liberal activists and their allies on Capitol Hill with a surprise opportunity to breath life into the proposal to create a government-run health insurance plan - a proposal that had been declared all-but-dead two months ago," The Hill reports. "Ironically, it's a shift that would have been unthinkable before Sen. Scott Brown (R-Mass.) won the late Sen. Edward Kennedy's (D-Mass.) seat in a special election last month." Without the crucial 60th vote to overcome a Republican filibuster, Democrats are turning to reconciliation, which requires only 51 votes and may give liberals an opportunity to insert the public option again.

"Over the course of three days, 18 Democratic senators signed on to Sen. Michael Bennet's (D-Colo.) Wednesday letter to Majority Leader Harry Reid (D-Nev.), requesting a floor vote on the public option should the upper chamber consider a healthcare reconciliation bill. ... Even Reid appears to be on board." His office issued a statement Friday indicating Reid would "bring the public option to the Senate floor." In addition, the "Obama administration appears to be ready to give it a go. 'If it's part of the decision of the Senate leadership to move forward, absolutely,' Health and Human Services Secretary Kathleen Sebelius said on MSNBC Thursday" (Young, 2/20).

Meanwhile, a new analysis studies another hot-buttom reform issue -- the so-called "Cadillac tax" and finds that "the conventional wisdom about the tax [on high-cost insurance plans] is wrong: The tax would actually fall equally on nonunion plans," The Washington Post reports. "At least 80 percent of the workers whose plans would be subject to the tax in 2019 would be in nonunion jobs, according to the analysis by Ken Jacobs of the University of California at Berkeley Labor Center and William H. Dow, a professor of health economics at Berkeley who was a member of President George W. Bush's Council of Economic Advisers. This impact is roughly in line with the overall breakdown of nonunion vs. union workers with employer-provided plans. And it would be true under both the version of the tax passed by the Senate and a more labor-friendly one the White House agreed to last month" (MacGillis, 2/22).

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This article was reprinted from khn.org with permission from the Henry J. Kaiser Family Foundation. Kaiser Health News, an editorially independent news service, is a program of the Kaiser Family Foundation, a nonpartisan health care policy research organization unaffiliated with Kaiser Permanente.