THE POISON PILL IN “OBAMACARE” THAT HELPED KILL LABOR LAW REFORM

Abstract

Embedded in the Patient Protection and Affordable Care Act of 2010 was a poison pill for labor. It took the form of an excise tax on higher‐cost, job‐based medical coverage—the so‐called “Cadillac health plans” negotiated by unions themselves. This deadly political booby‐trap became a major organizational distraction and resource drain during a key phase of labor's health‐care campaign. Instead of mounting a broad fight for expanded social insurance, unions were forced to wage a frantic defensive struggle against taxation of worker benefits. The “Cadillac tax” backed by Barack Obama was so redolent of John McCain's own stance on health care during the 2008 presidential campaign that it produced a “working class revolt” in Massachusetts. There, a Republican opposed to the excise tax defeated the Democratic Senatorial candidate running for the late Ted Kennedy's seat in January 2010. When the Democrats' lost their filibuster‐proof “super‐majority” in the Senate, the already controversial Employee Free Choice Act (EFCA) became the first political casualty of “ObamaCare.”