This report analyzes the loss to the federal budget by allowing this practice. This practice was initiated because it encouraged employers to pay for employees’ insurance plans. Health insurance has, since World War II, been an important recruiting tool. Businesses with better health benefits could choose from a larger more skilled employee pool. It’s been a trade off between higher salaries and more extensive benefit packages. ACA now requires taxing some of the insurance plans offered. These are now referred to as “Cadillac” plans with the intonation that these plans are perhaps somewhat lavish and therefore not really necessary. Those who have come to expect that type of complete coverage of their health care needs don’t think the plans are lavish but rather customary and essential. That’s not the debate here. This is just showing by how much the general federal deficit could be reduced if the practice of allowing employers to offer such extensive plans and claim tax exemptions for them were eliminated. Policy analysts have oft referred to these tax exempt plans as money lost to the federal coffers.