I was wrong. The health reform bill is not about money, it is about politics. I wrote that I did not believe the excise tax of 40% on the so-called “Cadillac” health insurance plans would pass since it was opposed by the labor unions who have obtained these plans for many of their members. Well, in what must have been a real “knock-down drag-em out” meeting between labor, the administration and the Congress, the Obama team came up with a politically expedient compromise. The unions would accept the tax as long as it is not imposed its members’ plans.
The main result of the comromise is that the expected return from this tax will be $30 billion over ten years, instead of the orginal calculation of $90 billion. In other words it cost the Dems $60 billion to win this point.
Added to the Medicaid special treatment given to Nebraska to secure its senator’s vote, it now appears that the Dems are prepared to give away lots of money in order to get this bill adopted.
I will not make the mistake of placing money above politics again.