ObamaCare has touched off another round of unintended consequences. Some employers are requiring all workers participate in their healthcare programs regardless of whether they have coverage through outside sources such as a spouse or the military. Furthermore, they are still deducting the monthly costs of those who choose not to participate.
The un-Affordable Care Act’s employer mandate requires that all businesses must provide health coverage for up to 95 percent of their employees or pay a fine if they have 50 or more full-time equivalent employees (FTE). Companies with 100 or more full-time employees, and average annual wages for the staff of above $250,000 must insure at least 70% of their full-time workers by 2015 and 95% by 2016. Small businesses with 50-99 full-time employees will need to start insuring full-time workers by 2016. (And by the way, "full-time employees" are people who work 30 hours or more by the ObamaCare definition, which lawmakers in Congress want to change.)
At issue is whether companies can force their workers to participate in their own company healthcare plans and deduct a portion of salary to pay for coverage even for those employees who opt out of the plans.
Two Miami companies that employ baggage handlers and other workers at Miami International Airport are pushing workers to sign up for company-sponsored healthcare plans and pushing workers to pay part of the healthcare costs, even if the workers already had coverage through an outside source.
Kaiser Health first reported on this story:
Under the health law, large employers that don’t offer their full-time workers comprehensive, affordable health insurance face a fine. But some employers are taking it a step further and requiring workers to buy the company insurance, whether they want it or not. Many workers may have no choice but to comply.
Some workers are not pleased. One disgruntled reader wrote to Kaiser Health News: “My employer is requiring me to purchase health insurance and is automatically taking the premium out of my paycheck even though I don’t want to sign up for health insurance. Is this legal?”
The short answer is yes. Under the health law, employers with 100 or more full-time workers can enroll them in company coverage without their say so as long as the plan is affordable and adequate. That means the employee contribution is no more than 9.5 percent of the federal poverty guideline and the plan pays for at least 60 percent of covered medical expenses, on average.
Experts say they don’t expect many employers to strong arm their workers into buying health insurance. Those that do may be confused about their responsibilities under the health law, mistakenly believing that in order to avoid penalties they have to enroll their workers in coverage.
Employer penalties for not offering insurance that meets the health law’s standards can run up to $3,000 per employee.
Companies should not be the villains here. They are responding to government imposed new regulations in a way that does not drain their bottom line.
Incentives and punishments matter. Businesses are desperate to avoid potentially being hit by a tax penalty for thousands of dollars per worker.
The mandate creates a deterrent to small businesses growing beyond the 49 employee threshold perchance they trigger the mandate. Second, the law defines full time as 30 hours which pulls in workers that would qualify as part time under traditional definitions. Employers then respond by limiting worker hours to under30 hours – creating so-called "29ers."
These are examples of unintended consequences of a massive and ill designed public policy. The Administration is fiercely defending a law that is causing harm across our economy. What we really must be talking about is plans to replace ObamaCare with smart, market-based solutions that will leave us all better off.