AFL-CIO

Richard Trumka, president of the AFL-CIO, had pushed for the exemption.

By BYRON TAU and JENNIFER HABERKORN | 9/13/13 7:20 PM EDT Updated: 9/13/13 8:29 PM EDT

The Obama administration on Friday told labor union leaders that their health plans would not be eligible for tax subsidies under Obamacare next year.

A White House official said the Treasury Department has concluded that such an exemption is not possible under the Affordable Care Act. The labor unions have been asking that their union plans, known as Taft-Hartley plans, be eligible for premium subsidies the way plans on the new insurance exchange will be.
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A senior administration official said the White House looked at several ways to make the union plans eligible for subsidies but couldn’t find one.

“It’s black and white,” the official said — there is no way to make the union plans, which are considered workplace benefits and already receive special tax treatment for that status, eligible.

Labor officials met privately with President Barack Obama, Vice President Joe Biden and Labor Secretary Tom Perez on Friday afternoon to press their case that the Affordable Care Act will have consequences for the benefits of union employees.

The president “heard the concern about the future of the nonprofit plans,” the senior administration official said.

The Treasury Department spelled out the details of the administration’s decision in a letter Friday to Sen. Orrin Hatch (R-Utah) and Rep. Dave Camp (R-Mich.).

“The Treasury Department issued a letter today making clear that it does not see a legal way for individuals in multi-employer group health plans to receive individual market tax credits as well as the favorable tax treatment associated with employer-provided health insurance at the same time,” the White House official said in a statement.

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