According to Ben Smith at Politico, Richard Trumka of the AFL-CIO is on his way to an emergency meeting at the White House:
White House and Congressional leaders have begun to discuss a higher-than-expected excise tax on some health care plans, in order to maintain their claim that health care legislation will reduce the deficit, a source involved in health care talks said.
Any unexpected change to the health care plan could endanger support for the bill from labor, which agreed to back it after reductions to the planned excise tax. Proposed new changes, I’m told, concern cuts to the rate at which increases to the tax exemption cap are indexed.
Democrats must have gotten a very bad CBO score and are now scrambling to find a way to lower the bill’s price tag. They could raise more money by lowering the threshold for when the excise tax on “cadillac” insurance plan kicks in, but that would anger Big Labor. However, getting exempted this excise tax is a must for unions.
It’s awfully late in the game to be shuffling money around, and it’s bound to create problems among interest groups who support the bill.
