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Dissecting the latest Blue Cross anti-reform mailer

The ink is barely dry on the health reform bill that passed the House, and Blue Cross already is out with a new attack mailer on health reform. [See the front [1]and back [2]here.] This mailer boldly proclaims “we can’t tax our way to affordable health care.” The text pays lip service to the need for reform but then, of course, comes the kicker – those reform proposals in Washington would “levy a 40% excise tax on so-called ‘Cadillac’ plans” to help pay for the costs of reform. The horror of taxing insurance plans would mean costs passed on to the consumer, so people are urged to send the anti-reform postcard to Senator Hagan.

The reality of the Senate Finance Committee’s bill’s provision that taxes super-wealthy health plans to help finance reform [this tax wasn’t in the House bill that just passed – House members chose to tax millionaires instead] is much different. The excise tax would apply to plans costing more than $8,000 for single individuals and $21,000 for families [and remember, this is after reform where insurers can’t charge people more because of pre-existing conditions or vastly more because of age.] It would only apply to amounts above those thresholds and most people’s health plans would not be affected:

In 2009, the average employer-sponsored health insurance plan is valued at $4,824 for a single individual and $13,375 for a family, far below the thresholds for the excise tax.

The health insurance plan most commonly chosen by federal employees — including Members of Congress — costs $5,872 for individual coverage and $13,446 for a family, again far below the tax threshold.

What plans would be affected [From the Center on Budget and Policy Priorities [3]]?

The executive medical and dental program at Goldman Sachs, one of the nation’s largest banks, has become the poster child for lavish health insurance plans. Goldman’s top executives participate in a medical and dental plan that costs $40,543 a year for each participant’s family — three times the national average, according to the New York Times. Paul Fronstin, director of the health research and education program at the Employee Benefit Research Institute, suggests that such extremely expensive plans are likely to have no co-payments or deductibles, no limits of virtually any sort on doctors or procedures, and no requirements for referrals.

As another example, the Boston Globe recently described a plan that costs $20,400 a year in 2009 for family coverage — far less than the Goldman Sachs plan, but still 50 percent more than the national average. The plan provides $450 annually towards gym memberships, or $200 for home exercise equipment, and $150 for yoga classes or nutritional counseling. It also requires no cost sharing for many procedures and services and only modest cost sharing for others.

So, in the end NC Blue Cross is back protecting its own. You can imagine the health plans the millionaire executives enjoy at NC Blue Cross – and you can bet they don’t want their personal plans taxed. In addition, you can imagine the revenue generation from other wealthy executive plans that Blue Cross sells. No wonder they want to defeat this part of reform.

Finally, while the text of these mailers occasionally seems to support health reform, I think the overall tone seems to be directed at defeating change. I think the anti-tax headline on the mailer says it all for Blue Cross. Unfortunately in the real world, any responsible health plan can’t add to the federal deficit. Whether you tax millionaires or you tax the health plans of the ultra-wealthy, that’s a fair way to help pay for reform.