Cadillacs for Everyone

The Story


Read more at city-journal.org
photo: Scott Olson/ Getty Images

Mayor de Blasio says that he’s cut a deal with the city’s municipal workers to save billions in health-care costs. But he hasn’t factored in the looming, Affordable Care Act-mandated excise tax on “Cadillac” health plans. Unless the city’s public unions agree to bear part of the tax’s weight, Gotham faces a $1.4 billion budget deficit in 2018.

The Facts You Need to Know

  1. Rapid Growth: Health care costs for city workers and retirees are projected to increase by 32% in the next five years, to $6.8 billion by 2019.  Read more.

  2. Paying Nothing: Public-sector workers in the U.S. pay, on average, 17% of the cost of their family-level medical premiums. In New York, city employees pay nothing. Read more.

  3. Throwing Weight: New York City should use its leverage as the sole payer of employee premiums to drive reform. Read more.

"If healthcare costs of local governments continue to rise and they start paying the 'Cadillac' tax, the combination will jeopardize public spending on essential services like schools and police.”

Brookings Institution

Twitter Take

The Past is Present

Health Care Demagoguery By Steven Malanga (Spring 2003)

New York’s health-care lobby is up to its old tricks.

On The Calendar

June 16

June 16, 2015 | New York City

Distinguished editor John Tamny uses entertaining stories from sports, movies, popular culture, and famous businesses to demonstrate the basic principles of economics, including: how the Rolling Stones, Dallas Cowboys, and Paris Hilton are examples of good and bad tax policy; how The Godfather, Gone With the Wind, and The Sopranos reveal the downside of antitrust regulation, and many more.

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And in other news...

Two Englishmen hoping to earn the Guinness World Record for riding the entire New York City subway in the shortest amount of time called it quits around noon when three combined service changes and delays made victory impossible.