Sen. John Kerry (D-Mass.) first introduced the plan this summer, arguing that the tax would compel insurers to reduce their costs and allocate their expenses in a more equitable way.
Businesses pay taxes on their lower paid workers' benefits, so officials say the move would correct a regressive tax structure. Employers would pay the tax, rather than employees.
But labor unions could cozy up to insurers and big business to fight the proposal because they are concerned that the cuts could go deeper, and that insurers would raise premiums or eliminate services to counteract their effect on profits.
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