By Alexander Bolton and Kevin Bogardus - 01/14/10 11:21 PM EST
The White House and Democratic senators negotiating a final healthcare bill gave ground Thursday to labor leaders to secure their support for a tax on high-cost health plans.
Labor representatives, including Richard Trumka, president of the AFL-CIO, Gerald McEntee, president of the American Federation of State, County and Municipal Employees (AFSCME), and Dennis Van Roekel, president of the National Education Association, negotiated all day Wednesday to reach a “conceptual agreement” with White House and congressional negotiators.
“We approached this by looking at the bill and saying we wanted healthcare reform," Trumka said about the agreement. “We don’t look at this as the end of the fight for reform but as another step along the way towards real reform.”
Trumka and other labor leaders praised the agreement and its main negotiators, including President Barack Obama, Speaker Nancy Pelosi (D-Calif.) and Rep. Joe Courtney (D-Conn.), who led opposition to the excise tax in the House. Union officials said they could get behind the final bill and campaign on it for the 2010 elections if it includes the agreed-upon changes.
“We will endorse it and we will do that proudly,” Trumka said, later adding that this will motivate workers to help get out the vote not only in the upcoming mid-terms but also for the 2012 races as well.
McEntee said he has already reviewed the deal’s details with his members across the country and was surprised by their reaction.
“They were elated in regards to going forward with healthcare reform and were ready to fight for it,” McEntee said.
The unions agreed to accept a 40 percent excise tax on high-cost plans with a few adjustments.
For example, the threshold on family plans that would be taxed has been moved from $23,000 per couple to $24,000. The threshold for individual plans will also be moved up, from $8,500 to $8,900.
Dental and vision benefits would be exempted from the tax beginning in 2015.
State and local government health plans and the plans of unions that are part of collective bargaining units would be shielded from the tax until Jan. 2018.
The taxable threshold for health plans would be increased on the basis of age and gender — the tax on the plans of older workers and female workers would kick in at a higher cost than for average plans. Elderly workers and female workers tend to have more expensive plans and this provision would shield them from bearing a disproportionate amount of the cost.
The taxable threshold for a family plan would be increased by $3,000 for each retiree in the plan not yet eligible for Medicare benefits. People between the ages of 55 and 64 who are not eligible for Medicare must pay high private insurance costs.
The taxable threshold for high-cost plans would be pegged to the Consumer Price Index plus one percentage point.
The excise tax contained in the Senate bill was estimated to raise $149 billion between 2013 and 2019. The concessions to labor unions will diminish the amount of revenue raised by the proposal.
The unions sought to provide a united front on the agreement in order to push forward on healthcare reform. The call with reporters included some of the biggest opponents to the excise tax, including McEntee and Larry Cohen, president of the Communications Workers of America.
But there are some in the labor movement who are not on board yet with the deal.
“It appears that a number of changes have been made to the excise tax provision of the health care reform bill to ease the burden on working Americans, but I’m disappointed that the excise tax remains in the bill,” said Harold A. Schaitberger, general president of the International Association of Fire Fighters (IAFF), in a statement. “IAFF’s position remains consistent – the excise tax is bad policy and bad politics.”
The firefighters union is an AFL-CIO member. Trumka said the labor movement would have written the healthcare reform bill differently if they had the chance but that was not possible.
“Politically, that was not achievable,” Trumka said.
This article was first published at 5:04 p.m.