As a small employer, I have long suspected that ObamaCare’s central business-provided health insurance “slogans” would end business-provided health insurance. Looking at the numbers in the bill, I have said since the bill’s passage that companies like mine would stop providing health insurance under ObamaCare, because it would be cheaper and reduce my potential litigation exposure.
If I’m not paying the insurance cost (and we cover ~70% of the cost of employee health insurance), then who will? Not the 1%, but the other 99% — Or care will just be rationed through the use of medical care panels like the Orwellian-named NICE panel in Great Britain. These panels are sometimes referred to as Death Panels since the rationing of care means that someone (not the patient or the doctor) will make the decision to end care.
The following is from the US Chamber of Commerce:
Two Obamacare promises are ringing hollow today:
1) We will build on the employer sponsored system
2) “If you like your health care plan, you can keep your health care plan.”
Despite constantly repeating these promises during Congressional debate and after it became law, the Administration’s promises are being undercut by a report issued by the House Ways and Means Committee which finds that the health care law “contains numerous policies that will either force or encourage employers to eliminate the health insurance coverage they currently offer their employees.”
Under the law, the “employer mandate” fines companies with more than 50 “full time equivalent” workers for failing to offer what Uncle Sam defines as “affordable” and “sufficient” health coverage to all full time workers. However, since the law’s penalty for not offering this prescribed coverage is far smaller than the costs associated with offering government defined “affordable” and “sufficient” insurance, employers are induced to drop coverage. This report quantifies (and cited) what the U.S. Chamber knew would happen.
Based on responses from 71 companies, the Committee found that the companies could save $28.6 billion in 2014 and $422.4 billion from 2014-2023 if they stopped offering health care insurance and paid a penalty to the government. This would affect 10.2 million employees and dependents.
Because of this law, “[a]nyone who gets insurance through their job should be worried about what will happen next, because [the law provides] a distinct financial incentive for employers to terminate health care coverage,” said Ways and Means Committee Chairman Dave Camp (R-MI).
During the health care reform debate and after the law was enacted many expected that the impact on large employers would be minimal, believing that the law would not impose any additional burdens or costs on large employers who have historically offered coverage. The Committee report counters this assumption. In fact, many provisions impose additional requirements on large employers and will drive up the cost of the coverage that they offer, if they offer it. Regulators are fleshing out these requirements now and will continue to do so for months, if not years to come. The truth is we still don’t know just how different the law will require employer sponsored coverage to be or how much more it will cost.
Therefore, the employer mandate doesn’t pose to employers the simple choice of “Do I continue to offer the coverage that I am currently offering or pay a penalty?” It poses the subtler choice, “Do I continue to offer coverage that is and will be increasingly-more expensive and burdensome for me to offer or do I pay a penalty?”
Why wait until the Affordable Care Act kicks in 2014? You could drop group insurance now and not even pay a penalty. 50 employees x $10K or so per for insurance – that’s a savings of $500,000 a year and zero penalty.
Problem is, minimum wage employees will end up on Medicaid, so we pay for them. Or they go to the emergency room with no coverage and we pay for them. The Affordable Care is addressing real problems.
The purpose of the $3000 penalty is to correct another one of those “free rider” issues. Where company owners game the system so the rest of us pay for their employee health care. Just like mandatory coverage for individuals is aimed at the free riders who decide not to have health insurance then go to the emergency room with a heart attack or a broken leg – and who pays? We do.
Same thing with the employer with 1000 workers paying minimum wage with no health insurance. Where do those workers get insurance? Medicaid, that’s where. If not Medicaid, then “free” at the emergency room. The employer doesn’t pay for decent coverage, the rest of us pay for his employees when they need Medicaid or emergency room healthcare.
Maryland had that problem. They had to pass a law to stop Walmart from shifting worker healthcare costs to public Medicaid. There is a certain logic to all this. WalMart offered coverage so lame, most of their employees qualified and used Maryland Medicaid. That’s why there’s an Obamacare provision saying coverage has to be pretty good. Does anybody think it’s cool for a business to employ a lot of people and we taxpayers pay for their health insurance?
Don’t worry about healthcare decisions being made by bureaucrats. That’s the way it’s done now. There’s not such thing as doctors and patients making big decisions on treatment. Treatment is approved by the insurance company not the doctor. Delaware Blue Cross got busted for denying vital heart testing to save a couple bucks. The doctors wanted the tests. The patients needed the tests. Blue Cross said no. Next time somebody says healthcare is between the doctor and the patient, just laugh. It’s a joke.
For all the moaning groaning about the Affordable Care Act, you gotta ask – what’s the alternative? Anybody got a plan. Not a slogan. A real plan. Last I heard it was sell across state lines. Affordable Care does that with the new State exchanges being set up.
The current system is unsustainable. Premiums are up 50% in ten years. Wildly up beyond inflation. Businesses large and small say insurance cost is a number one problem. So what are we fighting for here? The status quo. Don’t dare change anything. Don’t risk trying something new. Is there some secret alternative the critics have. Or is it just don’t do anything. Change is bad for America.
I guess the opponents will probably be able to kill this reform. Why, I’ll never know. Politics are so so bad we can’t even try to make things better. And that’s what this Affordable Care Act is. An attempt. A work in progress. Something we can change as we go along. Man I wish Obama was a white Republican. This Affordable Care Act would be no problem. Everybody knows we need to change the way health insurance is done if we want to compete with the rest of the world.
“For all the moaning groaning about the Affordable Care Act, you gotta ask – what’s the alternative? Anybody got a plan.”
There were a number of plans and alternatives. But the Democrats were disinterested in negotiating. You can even check this blog for a number of alternative proposals.
In fact, one of the alternatives to President Clinton’s plan was… wait for it… The Affordable Care Act, or a facsimilie thereof, offered by Republicans. But the goal posts are always on the move.
Of course, we can always modify the ACA by increasing the fines. You cool with that Charlie?
If one can find where I supported an individual mandate, then point taken. Otherwise, using 20 year old wrong-headed theorizing as good liberal social policy is standard practice on the left. Goal post stays put.
We’ll see in about a month what the Supreme Court has to say. At the moment, that is the only opinion on mandates that actually matters.
I have to agree with Holt that you need a mandate to make the system work as designed. However, the penalties are not large enough, so many individuals will not buy insurance anyway. It might have made more sense to mandate some very minimal, catastrophic-type insurance, but it appears that Congress wanted to make everyone buy a deluxe plan.
Ironies: the mandate would clearly have been constitutional if it were called a tax penalty, but the Democrats insisted it wasn’t a tax.
They call it Obamacare, but Obama stood on the sidelines and let congressional committees write the bill.
People of a leftish tendency cheered the bill because they hate the health insurance companies so much, but the health insurance companies are the clear winners on the deal.
the only mechanism to control medical costs is the single payer system, which every civilized industrialized nation in the world has. Your repuke impeached president Richard Nixon put the health care mandate on employers! The US is 37th in the world behind Costa Rica and Cuba and yet we spend more of our money for “health care” than all other nations. Why? Because the middle men the for profit insurance companies steal 45cents out of every dollar on millionaire CEO’s, shareholders, advertising etc, which has nothing to do with health care. Study was done right here in Delaware as to which system would cover everyone, cost effectively and save the state billions. SinglePayer thats who? Vermont is on the way to having it, and Delaware will too. We have 42 statewide organizations behind us, and we wont be backingdown to any unsubstaniated stupidity from the right wing…who just love these Big Pharma, Big for profits while they rob our citizens blind. There is enough money in the system right now (the study proved) to cover not only medical, but dental, long term care, vision, aids, prisoners you name it, and still conservatively save the State $4million in the first year. So all you conversatives this is an issue YOU should be signing onto…that is if you care about our citizens, keeping them healthy happy, and productive for future business.
Ahhh, yes. Cuba… If you believe that then I refer you to the inspiration of this site, Abraham Lincoln: “Keep silent and be thought a fool or open your mouth and remove all doubt.”
Charlie facts are facts….google it….yes indeed we are behind Cuba and costa Rica a couple of banana republics. You have just proven what a 1% without facts you are…facts are facts and your saying opposite doesnt make you right, only makes you look stupid and ignorant of the facts.
Facts are facts. Cuba is an opinion.
http://www.who.int/whr/2000/en/whr00_annex_en.pdf, pg 196) — The United States has the most responsive health care system in the world as measured by the World Health Organization.
So, please refer back to Abraham Lincoln.
Charlie, you are so right. The whole goal here is to have employers throw in the towel because it’s cheaper than insurance, thus forcing the federal government to have become the insurer. Why more people don’t see that is beyond me.