Skip to comments.Can Employers Dump Workers To Health Exchanges? Yes, For A Price
Posted on 05/28/2014 4:59:08 PM PDT by Oldeconomybuyer
How to expand Americans health insurance choices under the Affordable Care Act without sabotaging employer coverage? The Obama administration is still working to get the balance right.
The latest tweak from the Internal Revenue Service essentially prohibits employers from giving workers tax-free dollars to buy policies in the online public marketplaces created by the health law.
Nothing stops employers from canceling company plans and leaving workers to buy individual policies sold through the exchanges as long as they pay the relevant taxes and penalties, said Christopher Condeluci, a Venable lawyer specializing in benefits and taxes. Those will vary according to a companys size and circumstances.
If an employer has fewer than 50 workers, there is no penalty under the health law for dropping coverage or never offering it. Larger companies that dont offer coverage may be liable for fines of $2,000 and $3,000 per worker starting next year. (The employer mandate doesnt kick in for firms with 50 to 99 workers until 2016.)
Nor is there anything stopping companies from giving workers raises to buy individual policies on the exchanges as long as the money is taxed as income.
(Excerpt) Read more at capsules.kaiserhealthnews.org ...
I’m all for divorcing health “insurance” from employment so this isn’t all bad.
Moving insurance from employment to government is a disaster. Especially with the IRS as the enforcer.
Nobody on FR thinks having govt run it is a good idea.
But when unions obtained employer health coverage as a part of WW2 wage controls, it separated the cost from the user.
And that always produces a bad outcome.
Got it, and I agree.
“Nor is there anything stopping companies from giving workers raises to buy individual policies on the exchanges as long as the money is taxed as income.”
Lack of profits may well stop them from giving workers raises.
“Nothing stops employers from canceling company plans and leaving workers to buy individual policies sold through the exchanges”
Nothing stops employers from firing workers because they can no longer afford them either.
Well, that's easy enough for businesses to cover; just cut workers' pay by $2-3 thousand dollars a year.
Well considering that the cost to the company for health insurance can be about $10-20k per employee per year (depending upon how many dependents the employee has, how good the coverage is, etc.), paying $2-3k per employee each year in fines would actually save the businesses a lot of money each year.