How might the Affordable Care Act excise tax affect UAW FCA members’ healthcare?
In 2018, high-cost employer-sponsored healthcare plans will be subject to an excise tax under the Affordable Care Act. This tax will apply to healthcare plans that cost more than $10,200 per individual, and $27,500 for a family. The tax is 40% of the cost of health coverage that exceeds predetermined threshold amounts. A recent national survey from Mercer found that about one-third of all employers are vulnerable to this tax given their current healthcare plans. Unless the law is changed, it is expected that certain plans sponsored by FCA will be subject to the tax.
The UAW bargaining committee had to hold a hard line to maintain benefits. The company aggressively fought for premium share, out of pocket increases, and adding surcharges for not meeting wellness metrics. Under the new Tentative Agreement, health care is unchanged with no premium share.
We are always working to find cost savings that do not affect the quality of care as outlined in our agreements. In the event that we cannot achieve cost savings to offset the tax, we have negotiated terms that will allow members to voluntarily remain in a plan subject to excise tax at the cost of $400 deductible for single coverage and $800 for family (see page 113, Tan Book).