The WasteWatcher: The Staff Blog of Citizens Against Government Waste

Waking Up to Reality

The WasteWatcher is the staff blog of Citizens Against Government Waste (CAGW) and the Council for Citizens Against Government Waste (CCAGW). For questions, contact blog@cagw.org.


The press and many fans of Obamacare are beginning to wake up to problems with the healthcare law.  It appears reality, not the Utopia that was promised, is settling in.  I have written about this in an earlier blog found here.  Now, the New York Times is pondering another possible scenario with respect to the law and employers. 

We have already seen what some employers are doing – cutting hours.  For example, many restaurants that operate on relatively small profit margins are reducing workers' hours so they have no employees that work more than 30 hours a week.  Obamacare only affects employers with 50 or more employees that work full time, which is defined in the law as 30 hours or more.

But the New York Times points out some employers may choose to pay the fine of $2000 per employee if they do NOT provide health insurance as opposed to paying for a healthcare plan for each employee, now averaging $11,429 per year.  That is a big difference in costs and could mean huge savings for employers.

Of course, those of us who opposed Obamacare from the start saw this provision in the law as problematic and that it could eventually force employers to make a reasonable economic decision.  After all, while most employers want to attract and keep good employees, they are not in business to provide benefits.  They are in business to make money by selling a product.

Starting in October, employers start communicating to their employees what their healthcare choices will be for the upcoming year.  It is also when open season begins for the Exchanges in Obamacare.  The Exchanges are supposed to be up and running in all 50 states by January 1, 2014 but prospects that all this will occur on time doesn’t look good.   As of May 28, according to the Kaiser Family Foundation, there are 27 states that have decided to opt-out of creating a state-run Exchange, leaving it to the federal government to create one.  Whether the federal government can create that many functioning Exchanges by January is questionable.

Many employees could be in for a rude awakening this fall.  Their employers could tell them that the company will no longer provide health insurance and if they want coverage, they will need to purchase it from their functioning state (or federal) Exchange.  So much for the promise by President Obama, “if you’re one of the more than 250 million Americans who already have health insurance, you will keep your health insurance -- this law will only make it more secure and more affordable.”

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