By Tom Curry National affairs writer
updated 1/15/2010 12:14:43 PM ET 2010-01-15T17:14:43

Claim: Labor union members will get preferential treatment under the health insurance overhaul.

In 2008, union members accounted for 12 percent of American workers. For months, union leaders have been alarmed by a Senate Democratic proposal to tax high-cost health insurance, the so-called "Cadillac" plans. Over many years, unions have negotiated relatively comprehensive and costly health benefits plans as part of their bargaining with employers. Union leaders vowed to fight the Senate Finance Committee’s proposal of a 40 percent tax on benefits above $8,000 for individual coverage and $21,000 for family coverage.

Fact or fiction?
Fact. After bargaining at the White House, union presidents announced Thursday they'd won changes in the bill. Their biggest gain: a 5-year tax exemption. While the tax on high-cost plans will take effect in 2013, plans negotiated by unions will be exempt from the tax until 2018. Plans covering state, county, and municipal workers will also be exempt until 2018. "This just provides transition relief to help employers, insurers, and workers adjust to the permanent provisions" in the bill, said AFL-CIO president Richard Trumka. "We wanted, as long as we could, to not have an excise tax, because we never had one before," said Gerald McEntee, head of the American Federation of State, County, and Municipal Employees. But McEntee said the gains of passing the bill made compromise worthwhile. Cost of the changes won by the unions: about $60 billion.

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