In his July 15 Washington Post column, “Obamacare’s ‘Cadillac Tax’ is an important part of the plan so don’t mess with it,” Jared Bernstein argues that the Affordable Care Act’s 40 percent excise tax on health benefits is unlikely to hurt the vast majority of policyholders.

While in 2010 the Joint Tax Committee and CBO projected that the number of plans affected would be small, we now know that's not the case. According to the Towers Watson international consulting firm, "roughly half of large U.S. employers will begin to hit the excise tax in 2018 and the percentage is expected to rise significantly in subsequent years." That significant increase will occur because the inflation factor used to adjust the threshold at which the tax kicks in is significantly lower than the historical rate of health care inflation. Today’s “low cost” plan will become “excessive” tomorrow, and the people who will be hurt are the more than 150 million Americans who receive health care benefits from their employers.

Employers both large and small are united in apprehension that implementing the 40 percent excise tax will make it difficult to offer a plan that won’t be subject to this punitive tax, particularly in certain areas of the country where costs and consumption are higher. At the same time, the tax will lead to increased out-of-pocket costs for health care coverage while discouraging efforts to promote wellness and prevention.

Employer-sponsored coverage is the bedrock of the American health care system, and Congress and the Administration need to preserve that system by repealing the 40 percent tax or, at a minimum, substantially changing the way it's put into effect.