Health insurance plans-Goldman Sachs and Congress
NYT reports on $40,000/year health plans as we discuss health payment options for health care.
Goldman Sachs is one of the nation’s richest banks, and hundreds of top Goldman employees have a health care package to match — one of the “gold-plated Cadillac” plans cited by those involved in the health care debate in Washington.
Reach of Subsidies Is Critical Issue for Health Plan (July 27, 2009) Goldman’s 400 or so managing directors and its top executive officers participate in the bank’s executive medical and dental program as part of their benefits, according to documents filed with the Securities and Exchange Commission. The program generally costs the bank $40,543 in premiums annually for each participant’s family.
Those taking part in the plan include the company’s chief executive, Lloyd C. Blankfein, and four other top officers, as well as managing directors, whose base salary is $600,000.
Goldman’s medical coverage entered the health care discussion on Sunday when David Axelrod, senior adviser to President Obama, cited the Goldman program as an example of the expensive benefits the administration might consider taxing to help pay for its health care program.
“The president actually was asked this the other day by Jim Lehrer, and what he said was that this was an intriguing idea to put an excise tax on high-end health care policies like the ones that the executives at Goldman Sachs have, the $40,000 policies,” Mr. Axelrod said.
Goldman did not return messages on Sunday to comment about Mr. Axelrod’s comments.
A proposal by Senator John F. Kerry, Democrat of Massachusetts, would impose an excise tax on the insurers that issue policies like Goldman’s, with the expectation that the insurers would pass along most, if not all, of the cost to employers who buy the plans.
Leaders of the Senate Finance Committee, which is working on bipartisan version of the health care legislation in Congress, had long expressed interest in taxing some employer-provided benefits — a move many budget experts say would help slow the steep rise in health costs.
A number of Democrats opposed the plan, so negotiators began looking for other ways to cover the roughly $1 trillion, 10-year cost of the bill.
Senator Kent Conrad, Democrat of North Dakota and an author of the Finance Committee’s health bill, endorsed taxing rich plans during an appearance Sunday on “This Week With George Stephanopoulos” on ABC.
Asked if Congress would tax high-end plans, Mr. Conrad said: “I think we’ve got to. Again, virtually every economist that’s come before us has said you’ve got to reduce that tax subsidy as part of an overall strategy to really contain costs.”
An aide to Republicans involved in the Finance Committee negotiations said the idea was “on the table in discussions as a serious effort by Senator Kerry to restart the conversation on bending down the cost curve.” Aides to Senator Max Baucus confirmed that he, too, was considering the proposal, and House leaders said they were as well.
Negotiators have not yet determined the value of the plans that would set off a tax on the insurance companies; the numbers under discussion range from $20,000 to $40,000 annually, a senior administration official said.