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Again and again, critics and detractors of our Obamacare fail to read the fine print. Our latest controversy deals with the Obama administration's recent announcement of its continued intent to pursue an employer mandate.
Business groups complain that this policy is another example of executive overreach, another attempt to punish corporations, another piece of our health care too muddled to achieve any good. Let's break this down, shall we?
The Obama administration has already announced that it is still sticking to the timeline it clearly set out earlier this year. Just in case any of you, especially Obamacare critics, need a refresher:

An administration official said the White House is sticking to the timeline announced earlier this year. Companies with 50 to 99 employees will have another year — until 2016 — to start the coverage. Companies with 100 or more employees do have to comply next year, although they have two years to phase up so that they are covering 95 percent of their workers. Smaller businesses are exempt.
Okay, so not only are the small businesses that conservatives care SO much about exempt from the mandate, other companies have a generally large timeframe. But surely the holistic costs must be unbearable right? No. The article furthers:
The administration has estimated that the mandate will only apply to about 4 percent of employers. Most larger firms already offer health benefits.
That's right. This economically apocalyptic mandate is going to be harming a whopping 4% of the employed population? But surely, the costs to those individuals must be insurmountable right? Dead wrong again. The Hill explains:
People who don’t buy health insurance plans that meet the ACA’s minimum standards are fined 1 percent of their annual household income if they make more than $19,650. However if they make less, they are fined a flat rate of $95 annually or are not fined if they make less than $10,150.
So that's right. At best, the sweeping harms of the Obamacare mandate is set to affect 1% of the income of 4% of the employee population. Even if this economic harm still seems too much for you, let's take a stroll over to the opposing side and look at the economic argument in favor of Obamacare. Romney's Massachusetts (oh the irony) and the academic consensus make it very clear: Obamacare reduces premiums and costs for society by not only getting rid of the free rider problem, but also by countering adverse selection, making sure that our pool of insured is for the most part healthy. The Center for American Progress elaborates:
Moreover, estimates indicate that the individual mandate will work as intended to
counter adverse selection. The CBO concluded that the mandate will “encourage a
broad range of people to take up coverage in the exchanges.” As a result, the CBO
estimates that the influx of healthier enrollees will reduce average premiums by up to 10 percent in the direct-purchase market. Conversely, eliminating the mandate
would result in adverse selection, increasing premiums by up to 20 percent in the
direct-purchase market.
But let's end off with the most important qualification of this entry. To this day, the US remains the only Western country without a national healthcare system. Even if I'm completely wrong about the economics and it turns out that Obamacare is some prophet of economic doom, we cannot let ourselves get so lost in the money that we let ourselves play a game of lives and endanger both individuals and society. Frankly, I don't want to deal with anyone who is willing to.

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Comment Preferences

  •  Thanks for the diary (4+ / 0-)

    There was one part that seemed a bit confusing.  There was a quote that discussed the mandate affecting only 4% of employers.  Then the diary switched to discussing 4% of the population.  But the transition wasn't clear to the reader at that point.  
    Here's where that happened.

    That's right. This economically apocalyptic mandate is going to be harming a whopping 4% of the population?

    Still trying to figure it all out

    by CindyV on Sat Jul 26, 2014 at 09:07:17 AM PDT

    •  Duly Noted (1+ / 0-)
      Recommended by:
      BeninSC

      Whoops, meant to write "employed population". Thanks for catching that.

      •  Interesting series of diaries. (0+ / 0-)

        There are some terrific resources for new diaries on Daily Kos, linked below. You may find them useful! Best of luck to you!

        Welcome to Daily Kos. If you have any questions about how to participate here, you can learn more at the Community Guidelines, the Knowledge Base, and the Site Resource Diaries. Diaries labeled "Open Thread" are also great places to ask. We look forward to your contributions.
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        "The opposite of war isn't peace, it's CREATION." _ Jonathan Larson, RENT -9.62, -9.13

        by BeninSC on Sat Jul 26, 2014 at 12:29:29 PM PDT

        [ Parent ]

      •  The term "employed population" is an error. (0+ / 0-)

        Statistics need to be provided that show how many employees those 4% of employers actually employ, then show what percentage that number of employees is of the total number of employees nationwide by all employers.  The answer is not also 4%.

        Secondly, the $95 fine is merely the minimum; the total is 1% of the employee's total (taxable?) income, meaning the total fine can be many thousands of dollars assessed against well-paid employees.

        Thirdly, two years in the business world is not a "large" time frame.  And even if it were, it's irrelevant.  The purpose of delaying the employer mandate was to push its impact into the time frame following the 2014 elections; so now it will begin to hit prior to the 2016 elections.  As 2016 approaches, will it be again delayed?  What do the delays say about the wisdom of this aspect of the plan?

        Lastly, everyone seems to want to continue to ignore the Medicaid expansion problem ... or else, more likely, they don't even realize that the states which haven't availed themselves of it are likely to never do so for the simple reason that it comes with a HUGE price tag.  It is NOT true that the federal government will pick up most of the cost; in fact, it will only pay 50% of the costs incurred to cover all citizens who were previously eligible but failed to enroll.  In other words, under the new rules, those that were previously entitled to receive Medicaid but did not apply, but do enroll now, will cost their states 50% of their coverage costs.  It was recently reported (a month ago or so) that California, for example, incurred $1.2 BILLION in additional debt due to this twist.

        "Two things are infinite: the universe and human stupidity, and I am not sure about the universe." -- Albert Einstein

        by Neuroptimalian on Sat Jul 26, 2014 at 01:41:39 PM PDT

        [ Parent ]

  •  It's impact is even more minuscule The Obama ad... (1+ / 0-)
    Recommended by:
    se portland

    It's impact is even more minuscule

    The Obama administration estimates that this will affect 4% of employers, not employees.

    And even among those 4% of employers, only a fraction of those will be required to offer insurance before 2016.

    And if we assume that those 4% of employers who do not currently offer health insurance are at the low end of business size, with fewer average employees, then the number of workers who are affected becomes quite minuscule.

    These are all businesses with over 100 employees anyways, so they should be offering health insurance, to be more competitive in their labor market place and have more productive workers.

    I would love to see the actual numbers. I infer that perhaps á total of 100,000 - 200,000 or so employees of these businesses are affected, meaning that their employers will incur a small extra penalty for not offering insurance.

    (And if there is a business owner in there that who claims that they will have to go under rather than pay for health insurance or the penalty, that's not a very well run business and it would probably go under anyways.)

    So, nominal effect on businesses employing at most a few hundred thousand workers, versus 20 million Americans now with health insurance that they never had before. Which is more important?

  •  And for Employers of 25 persons or less (1+ / 0-)
    Recommended by:
    se portland

    there are Tax Credits available.

    For tax years beginning in 2014 or later, there are changes to the credit:
     

    The maximum credit increases to 50 percent of premiums paid for small business employers and 35 percent of premiums paid for small tax-exempt employers.
    To be eligible for the credit, a small employer must pay premiums on behalf of employees enrolled in a qualified health plan offered through a Small Business Health Options Program (SHOP) Marketplace or qualify for an exception to this requirement.
    The credit is available to eligible employers for two consecutive taxable years.

    Here’s what this means for you. If you pay $50,000 a year toward employees’ health care premiums — and if you qualify for a 15 percent credit, you save... $7,500. If you save $7,500 a year from tax year 2010 through 2013, that’s total savings of $30,000. If, in 2014, you qualify for a slightly larger credit, say 20 percent, your savings go from $7,500 a year to $10,000 a year.

    Vyan
  •  Health assessments and Wellness programs (1+ / 0-)
    Recommended by:
    notrouble

    One way the ACA has changed employer provided health insurance is the advent of health assessments and wellness programs. Since America still largely relies on employers to provide health insurance, companies are looking for ways to reduce the costs. What they are doing is offering discounts to employees who take a health assessment test. The most common tests are for things like cholesterol, smoking, blood pressure and body fat among others.

    Companies are using the carrot approach so far. Typically employees will get a $50 discount on their portion of health insurance costs by participating. But that can change. Under federal law, companies can charge up to 30% more on employee paid premiums based on health factors. If the employees cost exceeds 9.5%, they can switch to the exchange, which is what I think we are head towards.

    The arguments for and against it are both compelling. By offering discounts for a healthy a live style, people are more likely to exercise and quit smoking which reduces health care cost in general. But it is viewed as an invasion of privacy, and discriminatory against people with preexisting condition, genetic predispositions, and of course the older worker. When hiring new employees, companies will consider the entire cost of the perspective worker. Older and over weight candidates will tend to be overlooked because the total cost to the company for hiring them will be view as too high.

    I think that companies want to get out of the health insurance business altogether, and will find a way to shift employees into the exchange. It is a variable cost to them that is hard to manage. Already in my company you can not include a family member on your policy  if they have insurance available somewhere else. Even if you can, if the costs exceeds say $350 per month, you are better off in the exchange.

    Ultimately I think most of America will get their insurance in the exchange and not from their employers. Offer employees something like and extra $250 a month if they get their health insurance somewhere else. The company now has a fixed cost and can hire the BEST candidate for the job, not necessarily the youngest or healthiest. The cost to the company is the same.

    It is a weird first step toward a national health care system that involves the government paying private insurance companies to manage health care, but it is better than what we had.

    [I know that last sentence is not exactly right, but I don't know how to put it without going on to another 200 words.]

    “We can always count on the Americans to do the right thing, after they have exhausted all the other possibilities.” - Winston Chuchill

    by se portland on Sat Jul 26, 2014 at 10:04:07 AM PDT

    •  I am hoping... (1+ / 0-)
      Recommended by:
      se portland

      that the ACA slowly shifts us away from the employer health insurance model. It has been an unholy alliance.

      To be first in the soil, which erupts in the coil, of trees veins and grasses all brought to a boil. -- The Maxx

      by notrouble on Sat Jul 26, 2014 at 11:30:04 AM PDT

      [ Parent ]

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