Posted on 10/08/2014 1:50:53 PM PDT by SeekAndFind
Even before the Affordable Care Act was signed into law, its conservative critics warned of the perverse incentive contained within the law which could prompt employers to reduce the health benefits they offered to some of their employees.
“Because of the magnitude of the new subsidies created by Congress, the economics become compelling for many employers to simply drop coverage and help their employees obtain replacement coverage through an exchange,” former Tennessee Gov. Philip Bredesen warned in a 2010 op-ed in The Wall Street Journal.
“Providing incentives for employers to dump their employees into the exchanges is simply shifting the cost burden to taxpayers,” The Daily Signal’s Alyene Senger cautioned less than two years later. “Whatever the employer-dumping study du jour says, it’s not good for Americans who want to keep their employer-sponsored coverage in the new Obamacare era.”
Citing prominent Democrats like Sen. Harry Reid (D-NV), who told a Nevada media outlet that the ACA was a way in which the country could begin to “work our way past” the private insurance model, some conservatives charged that Obamacare was designed to kick start the process of dismantling the system of employer-based insurance.
The law’s backers predictably dismissed the concerns of these and other Obamacare critics. Some derided their criticisms charitably as reflective merely of a misunderstanding of basic capitalist incentive structures. Others, who were perhaps less inclined toward charity, derided Obamacare’s Cassandras as mere kooks and conspiracy theorists.
Citing a Modern Healthcare survey of employers in March, 2013, Think Progress blogger Sy Mukherjee observed that only 6 percent of employer respondents planned to transition their employees away from sponsored health coverage. “That assessment stands in stark contrast to some Obamacare opponents’ more outlandish claims,” he wrote. “[C]onversations about Obamacare tend to devolve into varying degrees of hysteria and fear-mongering that aren’t based in the reality of what the reform law will do.”
Vox.com founder and former flagship blogger for The Washington Post’s Wonkblog, Ezra Klein, has been perhaps the most prolific author of pieces dismissing the concerns of those who suggest large employers would scale back health benefits.
“Employers offer health insurance because employees demand it,” Klein wrote in the spring of 2013. “If you’re an employer who doesn’t offer insurance and your competitors do, you’ll lose out on the most talented workers. An employer who stopped offering health benefits would see his best employees immediately start looking for other jobs.”
Which is all to say that, for most companies, the Affordable Care Act won’t bring much change at all, and so there’s little reason to expect their behavior will change, either. And if it does change, it might not change in the direction we expect.
It was not long, however, before the unthinkable began to occur.
In January, the retail outlet Target announced that it would stop providing part-time employees with health benefits and would instead direct them to the health care law’s insurance exchanges. Target joined other large employers like Home Depot and Trader Joe’s, which had already announced similar plans to stop giving part-time workers access to employer-provided health benefits. On Tuesday, those large firms were joined by another even larger employer: Walmart.
26,000 part-time Walmart employees will now have to look to the Obamacare exchanges for their coverage. But for the left, which spent the better part of the last five years dismissing this development as unlikely, this is a “great thing!”
That is, at least, the assessment of former Wonkblogger and current Vox.com analyst Sarah Kliff.
If Walmart doesn’t offer her insurance, the Kaiser Family Foundation’s subsidy calculator shows that she qualifies for a $1,751 subsidy from the federal government to help buy coverage on the exchange. With that financial help, she can buy insurance for as little as an [sic] $7 per month. As a low-wage worker, she gets some of the most generous financial help.
But if Walmart does offer her coverage, it becomes her only option. She doesn’t qualify for federal help and the $7 plan disappears. Walmart’s plan, meanwhile, is way more expensive. The average premium there works out to $111 per month.
For a worker like that, losing health insurance at work doesn’t actually look like a bad deal. Instead, its [sic] a pretty good deal: it gives part-time employees the chance to qualify for way more generous financial help than Walmart would ever offer.
“Yes, there will definitely be some people who earn more at Walmart and get less generous subsides on the exchange,” Kliff conceded. “They could see their premiums increase with this decision. But given that this decision applies only to those who work fewer than 30 hours per week, they are likely lower earners who will be helped rather than hurt.”
Just a few broken eggs in the name of progress, right?
Kliff sounded the same note when Target announced its intention to turn its formerly independent part-time workers into public wards is a great boon to society. “The glass-half-empty reading of Target dropping coverage is that workers are losing access to an employer-sponsored insurance,” she wrote in January. “The half-full interpretation is that many are gaining access to government-subsidized insurance.”
Kliff is coming around to the fact, however, that there is a downside to the infinite enlargement of the number of federal beneficiaries: The unavoidable strain on the public coffers. She observed that Walmart, along with the rest of the large firms dropping benefits for their part-time employees, is “shifting costs over to the government, which will now take on the financial burden of helping to pay for thousands’ of part-time workers’ medical bills.”
But for the very poorest and sickest, being shifted onto the public exchanges will ultimately prove to be a blessing. The only problem with this analysis is that it fails to address the fact that conservatives warned of this condition years ago, and people like Kliff’s employer found their warnings utterly baseless. Keep that in mind while reading their latest attempts at cheerleading on behalf of Obamacare.
Just got my Obamacare bad news today. We have to switch over end of the year. $300 more per month + much larger deductale.
Thanks Odork.
Please share the good news with your Senators and Congressman:
www.senate.gov
www.house.gov
Obozo promised us a $2500 reduction. You just got a $3600 increase. The delta is $6100/yr.!
My benchmark lib simply denies any negative news about Obamacare.
Because government just has to shake the money tree to pay for that. What a genius.
Sure. I get a $7 per month plan with a high deductible and an extremely limited network of doctors and hospitals who will see me. In other words, “healthcare” in name only.
Getting out of from under health insurance costs has been a dream for the business sector for a long time. They (our elected officials) just had to figure out a way to do it and still guarantee profits for the insurance industry.
It’s so convenient not to have money, job, prospects, savings or a future. Great job liberals. Let Uncle Sam’s nephew Barack Ebola charm you with a little soft shoe while you wait for that lifesaving operation that never happens!
BTTT!
I went through this last year and it ended up being a blessing. My premium with Blue Cross was aprx. $750 per mo and was going up to $1,400. I joined Medi-Share, a Christian Healthcare Co-Op with a $10,000 deductible. The premium is $351 per mo. I then signed up with a Concierge Doctor (he takes no insurance, but provides his services for a flat fee) for $300 per mo.
I'm paying $651 per mo and I'm not in the govt system, nor am I paying for services I don't want.
Look up Healthcare Co-Ops and Concierge Doctors.
The cheapest ObamaCare policies have the highest co-pays and deductibles (to be fair, most of them also have a cap on out-of-pocket expenses).
Consequently, Walmart employees will save $104 per month on insurance premiums, but they may have to spend thousands more on co-pays and deductibles.
Come to think of it, laying her off completely could qualify her for free Medicaid, and for unemployment or welfare payments, which are “far more generous” payments than Walmart would ever offer for not working.
Makes a lot of sense if the goal is to having every working person dependent on the government, but doesn’t do much to support a productive society.
the insurance companies are just picking up these people as individual policy holders. for now anyway.
Hurting people is what they want. We need to drive this point home over and over.
Of course they are. To them, more people dependent on Government is a good thing & means more votes.
We find out next week. All we know so far is we have a new provider and prices are going up. How much is a surprise...
ObamaCare proceeds according to plan - the goal is to create such a catastrophe that a majority demands single payer.
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