Skip to comments.Obamacare: Workplace Disaster Ahead
Posted on 01/09/2014 1:06:12 PM PST by Kaslin
In 2014, 25 million to 30 million Americans who have employer-provided health insurance are likely to lose it thanks to Obamacares requirement that all plans cover what Washington deems essential benefits. Some employers will consider that unaffordable and drop coverage altogether, when their current, lower cost plans expire over the course of the year. These 25 to 30 million are in addition to 6 million who bought plans in the individual market and had them cancelled by January 1.
The plight of those 6 million made headline news and caused the first cracks in the Democratic Partys support for the law. The bigger wave of workplace cancellations will force Democrats seeking re-election this fall to defend a law that harms twice as many people as it helps.
Thats right. At least twice as many will lose coverage in 2014 as will gain it.
The Congressional Budget Office projects 16 million will gain coverage through the laws Medicaid expansion and subsidized exchange plans. Thats a best case scenario, rosier than the enrollment figures weve seen so far, but still half the number losing coverage.
There were warnings of this workplace disaster. In 2011, McKinsey & Company, management consultants, cautioned that nearly one third of employers surveyed were considering dropping coverage in response to the law.
Employers who self-insure are not affected by the essential benefits requirement, but employers who purchase coverage in the small group market (for about 60 million people altogether) get clobbered.
The one-size fits all requirement adds a whopping $1.79 an hour to the cost of a forty-hour employee, and over $2 an hour in New York and New Jersey, where health plans are more expensive, according to economist James Sherk of the Heritage Foundation. Its one thing if youre paying lawyers and accountants, but unaffordable for waiters and receptionists.
Michael Kennedy, who runs two dog grooming salons near Albany, New York said the requirement doubles his insurance cost per employee, eating away at his small profit.
The thirty-one and a half million people most at risk of losing their on-the-job coverage currently get it from employers with fewer than fifty employees. These employers are free to drop coverage, and many will.
Employers with fifty or more full time workers may be in a different spot, because the Affordable Care Act mandates they provide coverage. The law says the mandate shall take effect on January 1, 2014. The president delayed it (without legal authority) until January 1, 2015, and its likely never to happen. Nevertheless, employers will prepare in case it does.
Last year at this time, public and private sector employers began pushing full time workers down to part time status and avoiding full time hiring. An astounding 77% of hires in the first seven months of 2013 were part time, until the president delayed the mandate. The possibility of the mandate is likely to cause a repeat of last years problem.
If it goes into effect, employers with over fifty employees will have to either provide the essential benefits and pay fees levied on covered employees by Obamacare and cope with reporting requirements;
Drop coverage and pay a $2,000 penalty per employee, which adds 98 cents an hour to the cost of a worker, instead of $1.79 or more. Dropping is a better deal.
Its not a bargain, however, for most employees losing coverage. Workers with on- the- job coverage contribute $999 year in pre-tax dollars and have a deductible of $1,135 on average for individual coverage, according to the Kaiser Family Foundation. On Obamacare exchanges, all but the lowest earners will pay more (even after subsidies), pay with after-tax dollars, face deductibles of $3,000 to $5,000 for silver and bronze plans, and lose access to many doctors and hospitals.
Finally, add to those losing coverage the 3.1 million workers in low-margin industries who had mini-med plans. Obamacare barred these plans in 2010, but the administration handed out waivers to postpone the fallout. Those waivers expired January 1.
All in all, the toll of those losing coverage in 2014 probably will reach 30 million. And most will find Obamacare an unaffordable and low quality alternative.
This is their plan, destroy it and then claim single-payer is the only possible fix.
The workplace disaster is spelled: O-B-A-M-A!
Bottom line will be....it will be deducted right out of your paycheck....just like Medicare...and call it Mediscam.
watch as companies dump retiree medical coverage plans too, forcing them onto the exchanges and/or medicare.
“watch as companies dump retiree medical coverage plans too, forcing them onto the exchanges and/or medicare.”
Companies have been putting retirees on medicare for decades. Standard practice before Obamacare.
The workplace disaster won’t really show itself until the Democrats win the 2014 elections. Then, the poor, ignorant masses will be confused and momentarily outraged.
Fortunately, the media will step in to explain how the failures of Obamacare are the result of Republicans existing. The solution will be single payer so that the good, honest, caring Democrat government can take care of people.
The public will return to facebooking on their smartphones.
Republicans have to get this hung around the Democrats necks now!
But the midterms are before the real pain is felt by most Americans so it is unlikely with the Republicans we elected to office.
I am a senior citizen and am on Medicare. Believe it or not I still pay for it. The premium is taken out of my social security checks, even though I paid into it when I was younger and working
He just wants to get his hands on all those health care dollars.
Workplace disaster! I would call it an act of political terrorism.
I know for a fact that Eastman will drop paying their retiree’s insurance this year. That’s a pretty big company with a lot of retirees. The veterans will move to the VA. The rest will move to medicare and medicaid.
Yep, my former employer required me to go on medicare at age 65 and employer became my secondary insurer. Company also pays my medicare premiums.
Of course. Medicare and Social Security were sold to the gullible public as insurance for older folks, but as the Ponzi scheme unravels, it will be just another welfare program.
It won’t matter how much you paid into the system, you will only get what the govenment says you “deserve”. People who never paid a dime will receive more in benefits than people who thought they were going to receive a promised benefit for all they contributed over the years. Government programs always deliver less and cost more than promised.
True. King Fubo has already handed down the mandate that forbids insurers from issuing cancellation notices until after the election.
Except that everyone that works or has worked and is retired and on SS pays for it, including those who receive it. Those who are on welfare and medicaid do not pay a penny for their benefits
Yes, exactly. It was sold to Americans as one thing, and now the rug is being pulled out from under those who “worked hard and played by the rules” - to quote politicians’ favorite slogan.
It’s a giant con job.
I have a question for you. What are you going to do to prevent them from winning the 2014 election? Will you make sure that they do not win, or do you believe the Republicans should be punished because you might not have agreed with what a few did and think the entire party should be punished. Even thought it is the Rat party that is evil
If you do, then shame on you. If not then I apologize in advance
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