Employer sponsored health insurance is one of the most knotty features of our healthcare system. Political considerations, however, prevent lawmakers, to address this problem with sincerity and determination. Republicans who have always been strong advocates of it, may garner political brownie points in the short-term, but will grossly weaken long-term efforts aimed at market oriented reform.
The Ways and Means Committee has released a report that enlightens how Obamacare, through incentives, encourages companies to unload their workers onto the new law’s subsidized exchanges.
The report, surveyed companies in the Fortune 100, asking their CEO’s how many employees, both full-time and part, they had and how much they spend on health-insurance for their workers. They received 71 responses, upon which they based the findings of their report.
The Ways and Means staff computed that these 71 companies could save up to $28.6 billion in 2014, and $422.4 billion between 2014 and 2023, if they paid Obamacare’s fines and shifted the onus of health-care for them onto the subsidized exchanges.
The penalty per employee is a paltry $2000 per employee. James Capretta, of the Ethics and Public Policy Center said, “The penalties for the employers who drop coverage are very low, and the subsidies for the workers in the exchanges are very high.”
Committee Chairman Dave Camp, a Michigan Republican, said the data released by The Ways and Means Committee, has dangerous portents, “Anyone who gets insurance through their job should be worried about what will happen next, because there is a distinct financial incentive for employers to terminate health care coverage under the Democrats’ health care law. It is clear to me that because of this law, Americans will not be able to keep the health care plan they have and like. American workers and taxpayers simply cannot afford to have this law remain on the books.”
The survey says that that 84 percent of the CEO’s who responded to the survey expressed apprehension that “future health costs will increase at rates that are greater than those they’ve experienced over the past five years.” Over the next five years, insurance expenses will grow faster by 1.70 percent and is expected to reach 7.6 present from its current 5.9 percent.
The garnered data makes for interesting calculations and can contribute usefully to the health-care debate. Conservatives have always held the opinion that health-care reform can only happen if the insurance-market is shifted away from employer-sponsored insurance toward an individual market. Meanwhile Liberals are already gearing up for the chance to confront the Republicans who have always attacked Obamacare’s proposals to give a face-lift employer-sponsored insurance market. Obamacare aims to “slowly [reduce] the employer health benefit tax break while simultaneously creating insurance exchanges with subsidies.”
Noam Levey in an article in Los Angeles Times wrote, Mitt Romney “has embraced a strategy that in crucial ways is more revolutionary—and potentially more disruptive—than the law Obama signed two years ago. The centrepiece of Romney’s plan would overhaul the way most Americans get their health coverage: at work. He would do so by giving Americans a tax break to buy their own health plans. That would give consumers more choices, but also more risk.”
The Ways and Means report draws attention to the manner in which Obamacare is likely to drive premiums upward, the single biggest reason why employers want to forego health-coverage and make it someone else’s responsibility. On the contrary, the Republican solution will drive costs downward, which will give an incentive to employers to continue to provide health-coverage to their workers, even if the tax-treatment of health insurance is equalized.
Healthcare is an important issue that carries strong fiscal and human consequences. The report cautions that if Romney and his team want to be running the country next year, they must not use the Health-care issue as a campaigning tool, they must do it with an eye to governing – it is too serious a matter to be reduced to being a campaigning leverage to the presidency.New Report Could Prompt Employers To Quit Offering Health Coverage by Harrison Barnes