‘Cadillac tax’ opponents to keep fighting for full repeal

One of Congress’s strongest opponents of ObamaCare’s “Cadillac tax” says he will not halt the campaign to fully repeal the measure after congressional leaders reached a deal Tuesday for a two-year delay.

“I certainly am determined to keep doing what I’ve been doing, obviously, to work to strike this from the law,” Rep. Joe Courtney (D-Conn.) said in a phone interview Tuesday.

{mosads}“The coalition that stood up, in no time, on both sides of the bargaining table — employer and employees — are totally still all in,” he added.

House Speaker Paul Ryan (R-Wis.) told members Tuesday night that leaders have negotiated a two-year delay of the health benefits tax as part of the government spending bill, according to a source in the room.

Ryan also announced a deal on the year-end tax extender package, which includes a two-year freeze of the tax on medical device manufacturers, the source said. The bills have not been officially released.

The pause of the Cadillac tax and the medical device tax deal a major blow to the administration, which has repeatedly said it would oppose any congressional efforts related to the healthcare law that are not intended to improve it.

Administration officials, including Obama’s Chief Economist Jason Furman, have said the Cadillac tax is particularly crucial to the healthcare law because it is intended to reduce the overall spending on healthcare.

But the 40 percent tax on generous benefits packages has been almost universally opposed by employers as well as organizations, from the American Cancer Society to the American Federation of Teachers.

Courtney, who has opposed the tax since the Affordable Care Act was first drafted, said there is likely no chance Congress will be able to fully repeal it while Obama is in office. But with a two-year pause, it means that the next president will be able to nix it for good; all of the 2016 candidates in both parties have opposed the measure.  

“I view this as progress, but I would describe it as relief but not a fix,” he said. “To some degree, it’s a truce.”

Union groups, which tend to negotiate larger benefits packages instead of higher wages, have applied strong pressure to roll back the tax. Democratic leaders, House Minority Leader Nancy Pelosi (D-Calif.) and Senate Minority Leader Harry Reid (D-Nev.) have led negotiations to do so since November.

Rank-and-file members, including Courtney, have been working since the Affordable Care Act was first drafted to prevent the tax from taking effect.  

Courtney reintroduced a bill this February, shortly after Republicans won the Senate, to repeal the health benefits tax, tallying more than 200 co-sponsors. Rep. Frank Guinta (R-N.H.) has also introduced his own bill that has attracted broad Republican support.

While Republicans have been equally opposed to the Cadillac tax, GOP leaders told Democrats that they would only agree to pause the tax if it went alongside a pause of the medical device tax.

That tax, directed at some of the nation’s largest companies, has been less important to Democrats, though it has gained high-profile allies such as Sens. Elizabeth Warren (D-Mass.) and Al Franken (D-Minn.).

That tax, intended to finance healthcare reforms, had already gone into effect, but Courtney said it “got a second wind” with the tax extenders package. Lawmakers have been lobbied for years by a powerful coalition of medical device companies, represented by AdvaMed, which went into high gear in 2016.

“I think they’re riding in the wake of the Cadillac tax,” Courtney said. “When they saw that Cadillac tax was really moving, they kind of jumped on that.”