Under the plan I submitted to the committee, the employer exclusion would not have to go. In fact, it would be the way to finance insurance for everyone as a credit to an expanded business income tax (which would tax payroll and replace the taxation of the first 25% of all tax rates and payroll taxes - less the rate for a VAT to fund government services). The way to cap the benefit is to report it as personal income. Payments under the child tax credit and any education, charitable contribution and ESOP sales exclusions would not be included - however any interest, dividends, base pay, commissions, housing, mortgage interest, inheritance liquidation and health benefits would be taxable for individuals over $75,000 and families over $150,000. The responsibility to pay these taxes would fall on the employee or stockholder rather than on the employer - although the taxpayer could request withholding. This would hit folks who have boutique plans - although there would likely be a catastrophic care exclusion on actual payouts - although some services might be considered income - like luxury assisted living arrangements. If getting more income is desired, then tax rates would be higher. If the desire is merely efficiency, then capping the amount is not really effective. What would be effective is limiting the tax exclusion to the value of High Deductible Insurance and the payment of Health Savings Accounts (with personal income exclusion up to the level of HSAs for Flexible Spending Accounts). Any HSA payment higher than that paid for the broad based of employees would be considered personally taxable income if over the income exclusion (in other words, if your rank and file get a $5,000 HSA and your executives get a $10,000, the last $5000 for the executives is considered taxable income - unless of course the entire benefit is counted as income). This kind of cost saving tool only works if everyone must use it. if you have some people with comprehensive insurance and others with high deductible/HSA combinations you are developing a health care class system, which should not be allowed. Of course, cutting the benefits of the majority of people makes the entire reform unpalatable - so cost cutting must likely wait until the choice is between cuts and a huge increase in taxes.