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‘Cadillac’ Plans an Issue in Health Care Conference

By Alyson Klein — January 11, 2010 1 min read
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Congress is back this week. And while we’ve got a ways to go before lawmakers get down to work on the reauthorization of the Elementary and Secondary Act, or even the fiscal year 2011 budget bills, there’s one piece of legislation folks in the K-12 community should watch very closely: the health care bill. While there isn’t much in the bill that relates to schools specifically, at least one debate over how to help fund a health care overhaul could have a lasting impact on teacher recruitment and retention.

Both the House of Representatives and the Senate have approved their versions of the legislation. Now, lawmakers and the administration are wrestling with a compromise measure that they hope to send to President Barack Obama’s desk before the state of the union, slated for late this month or early next.

One of the thorniest issues on the table, right behind that public option you’ve been hearing so much about, is the question of how to pay for the expanded coverage. The House bill includes a tax on high-income folks, while the Senate bill would place an excise tax on so-called Cadillac health plans, those that cost more than $23,000 a year.

Many of those plans cover union members, including teachers. Since that threshold is raised a little every year, more and more teachers’ plans eventually could be subject to the tax, folks I talked to for this story told me. The inclusion of the Cadillac plan tax was a blow to the teachers’ unions, which have been working hard on behalf of health care overhaul.

Union folks and others warn such a tax could make recruitment and retention tougher, particularly for beginning teachers in high-need subjects such as math and science, who currently might choose education over a higher-paid career in part because of the often generous benefits,

So be sure and watch how this issue shakes out in conference. You can bet lobbyists for the NEA and AFT are tracking it closely too.