Obamacare hits keep on coming

Public Sector Pension perils of Obamacare

CalWatch: Even those who clearly understand the changes, however, have found reason for worry. Not only individuals but large organizations have begun to brace for dramatic changes in the years ahead.

At a meeting last month, for instance, CalPERS’ Pension and Health Benefits Committee voiced dismay over the so-called “Cadillac tax” due to hit the kinds of coverage many of its beneficiaries have enjoyed to date. A cost report for staff warned that the excise tax, which takes effect in 2018, will impose “a 40 percent excise tax on the aggregate cost of health benefits that exceed $10,200 for individual coverage and $27,500 for family coverage, indexed to inflation. Contracting agencies that offer health benefits through CalPERS are very concerned about cost impacts of the 40 percent excise tax.”

According to the report, “as part of exploring options for containing costs while maintaining high quality, the Board’s Pension & Health Benefits Committee directed staff to research the option of removing the broad networks in areas where narrow networks are widely available.”

At the same time, CalPERS recently announced that the Golden State “and its schools will increase their contributions to employee pension funds by 6 percent starting July 1,” according to Reuters. “The California Public Employees’ Retirement System, or CalPERS, said the increases were driven by payroll growth, salary increases and retirees living longer.”

Now, let me say. Any UC College professor who has been around for ten years knows perfectly well this volatility was established when No CHild Left Behind hit California.  All California legislators are perfectly aware that we face ten years of volatility. Kevin Drum has wide experience watching the mix of California and DC public programs, he is perfectly aware. So if any of this   collection fails to give a sound analysis of these perils, they are frauds.


Let us list the Obamacare hits.

• Obamacare taxes were incorrectly listed as consumption expenditures on the BEA report, and that caused nationwide confusion.
• Public sector pension system will be under stress for years to come. This may force Chicago into bankruptcy.
• Tax systems will become increasingly fraudulent, volatile and backlogged.
• There is a real issue of how California is going to cover the costs for all the new California citizens who do not qualify as federal citizens.
• Hospital and insurance systems are going through massive consolidation causing supply chain volatility which will last for years.