3. What coverage is not subject to the excise tax?

The value of employer sponsored coverage for long term care and the following benefits described in Code Section 9832(c)(1) that are excepted benefits and exempt from the portability, access and renewability requirements of the Health Insurance Portability and Accountability Act (HIPAA), namely:In determining whether the value of health coverage exceeds the threshold amount, the following items are not included.

coverage only for accident or disability income insurance, or any combination of these coverages;
coverage issued as a supplement to liability insurance;
liability insurance, including general liability insurance and automobile liability insurance;
workers' compensation or similar insurance;
automobile medical payment insurance;
credit-only insurance; and
other similar insurance coverage, specified in regulations, under which benefits for medical care are secondary or incidental to other insurance benefits.
The value of independent, noncoordinated coverage described in Code Section 9832(c)(3) if that coverage is purchased exclusively by the employee with after-tax dollars (or, in the case of a self-employed individual, for which a deduction under Code Section 162(l) is not allowable). Such Code Section 9832(c)(3) coverage includes coverage only for a specified disease or illness, as well as hospital indemnity or other fixed indemnity insurance. Fixed indemnity health coverage pays fixed dollar amounts based on the occurrence of qualifying events, including but not limited to the diagnosis of a specific disease, an accidental injury or a hospitalization, and no coordination with other health coverage. The value of employer-sponsored health insurance coverage does include the value of such coverage if any portion of the coverage is employer-provided or, in the case of a self-employed individual, if a deduction is allowable for any portion of the payment for the coverage.
Any coverage under a separate policy, certificate, or contract of insurance that provides benefits substantially all of which are for treatment of the mouth (including any organ or structure within the mouth) or for treatment of the eye.

4. Is there any relief in the Cadillac tax rules for people whose health coverage is expensive because their occupation is dangerous?

Yes. The annual limits are increased by $1,650 and $3,450, respectively, for employees in high-risk professions (e.g., law enforcement, EMT/paramedics, construction, mining, longshoremen, and so forth).

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