Despite setback, AFL-CIO rallies to support reform bill

DESPITE SETBACK, AFL-CIO RALLIES TO SUPPORT REFORM BILL…. As the final provisions of the Democratic health care reform package was coming together, a wrinkle emerged. In order to get the best possible score from the Congressional Budget Office, Dems would have to tweak the excise tax on some health care plans.

For unions, this could pose a problem, prompting a hastily-arranged meeting at the White House yesterday between President Obama and AFL-CIO President Richard Trumka.

The meeting must have assuaged fears — the AFL-CIO threw its full support to the Democratic reform plan today.

The group’s Executive Council met on Thursday to discuss new legislative language that will index the excise tax on so-called “Cadillac” plans to the Consumer Price Index (the rate of inflation) rather than the Consumer Price Index plus one percent. The change, which is in the final bill, will affect more union insurance policies at a quicker rate over time. And in a last-minute meeting at the White House, the union’s president, Richard Trumka fought the new language.

He lost that battle. But in the process was able to secure provisions that were enough to temper the discouragement he and his union colleagues felt. Under the final bill, all insurance plans (not just those that were structured from collective bargaining) will be exempted from the excise tax until 2018.

This was not in the original deal. But labor officials view it as a major victory.

Keep in mind, despite yesterday’s dispute, the AFL-CIO’s support will not be tempered or luke-warm. On the contrary, the powerhouse is taking steps to “bring the hammer down on wavering House Dems.”

“Everybody who’s undecided now, all the different union presidents are going to get on the phone and bring very heavy pressure,” a labor source told Greg Sargent. “Trumka, McEntee, Larry Cohen — all of our presidents will be laying down the law.”

The effort will need all the help it can get.