Are there any exceptions?

• Some for age and occupation:
  For early retirees and certain "high-risk" occupations such as firefighters and law enforcement--the amounts are higher--$9,850 for individual and $26,000 for family coverage.

• Some for high-cost states:
  For workers in the 17 highest cost states, there will be higher limits for the first 3 years. If you live in a high cost state, the amount in 2013 would be $10,200 for individual and $31,200 for family coverage.

The current Senate bill doesn't specify the 17 highest cost states, but they are likely to include:

AK · NH · NY · ME · DE · CT · MA · DC · WY · NJ · IL · VT · CA · AZ · PA · TX · RI

What do health care plans cost now on average?

This year, the average is roughly $5,000 for individual coverage and $13,000 for family coverage.

Why are some plans higher or lower than that?

Factors such as age and the health needs of participants often have a big effect on costs. In addition, some areas of the country have less competition and higher health care prices and practices.

If the cost of my health plan is effected by geographic location or other non-benefits related conditions, why should I or my employer have to pay a new tax?This is not because I have so-called "Cadillac" benefits.

You're right. This is unfair, and is one of the reasons SEIU strongly opposes the tax.

What counts toward the amount by which my plan will be taxed?

You will be taxed on the following combined benefits:

    * Both employer and employee premium shares
    * Any additional dental and vision premiums, and
    * Any amount in a flexible spending account

As a side note, a new maximum limit of $2,500 per year will be set on flexible spending contributions.

When does the excise tax kick in?

The tax goes into effect in 2013 in the current Senate bill. Each year, the thresholds would be indexed to the inflation rate plus 1 percent. By contrast, health care costs have been increasing by twice that rate. More and more health plans will hit the threshold after 2013 if health care reform does not succeed in reining in costs in the overall health care system.

Can you give an example of how the tax might work?

Suppose you are covered in a plan today and the total premium (including dental and vision) costs $6,800 for individual coverage and $16,200 for family coverage. If your plan's total costs increase by less than 25% for individual coverage and 42% for family coverage between now and 2013, your plan will not be subject to the tax in 2013.

If your plans costs rise by 30% between now and 2013, your plan would owe $136 on your policy ($6,800*1.3)-$8,500 =$340. A 40% excise tax on $340 would be $136.

If you had a family plan that cost $25,000 in 2013, your plan would owe $800 on your benefits.

If employers and workers cut their benefits rather than pay the tax, how does it raise revenue?

Economists say that because our employer-provided health insurance is not subject to income and payroll taxes, but wages are, that workers are putting too much of their earnings into "Cadillac" plans, which drives up costs.

These economists wrongly assume that employers will dole out wage increases to compensate workers for accepting health plans with lower total premiums. Most Americans have a different experience. In the real world, unemployment is high, jobs remain insecure, and workers are not seeing pay raises.

Even if we assume that wages increase to compensate for cheaper health plans, workers will still be hit by income and payroll taxes, as well as ever-increasing health premiums and out-of-pocket costs. By depending on workers to help lower health care costs, the Senate bill does not adequately contain price-hiking by insurers.

Instead of taxing our benefits, the House bill taxes income on the wealthiest Americans (individuals earning $500,000 and families above $1 million). SEIU continues to advocate for this approach. After eight years of Bush administration-era tax cuts on the wealthy, this is the only progressive way to finance reform.

Why is the Senate considering this tax?

Some Senators think this tax will lead to more cost conscious insurance plan selection and motivate employers and workers to shop harder for more cost effective coverage. As we know, a more cost-conscious health plan may just be one with higher deductibles and other out-of-pocket costs. Instead of ensuring that insurance companies are held accountable in keeping costs down, this tax puts the cost-cutting burden on middle-class Americans and working families.

Bottom line: The bill passed by the U.S. House has a different - and more equitable - approach to financing health insurance reform. It increases the income tax on the wealthiest Americans, asking that they pair their fair share on fixing our broken health care system.