Nearly one in 10 employers to drop health coverage (because of ObamaCare!)

The Washington Times
july 24, 2012

Nearly one in 10 employers to drop health coverage
Well even the Congressional Budget Office is saying 7% will drop out and pay the fines.

This latest estimate is from the consulting company Deloitte.
(This survey was taken Before the law was upheld by the Supreme Court)


They say more like 9% will leave employees to fend for themselves and IMO, probably won't give raises either.

This whole thing could easily lead to lower real-time wages across the board for the average worker.

Not to even consider the massive taxpayer funding necessary to pay for the lower wage earners.

IMO, taxpayer funding makes it easier for all the administrative leeches to keep their pockets full every step of the way.

About one in 10 employers plan to drop health coverage when key provisions of the new health care law kick in less than two years from now, according to a survey to be released Tuesday by the consulting company Deloitte.

Nine percent of companies said they expect to stop offering coverage to their workers in the next one to three years, the Wall Street Journal reported. Around 81 percent said they would continue providing benefits and 10 percent said they weren't sure.

The companies, though, said a lot will depend on how future provisions of the law unfold, since most of the key parts are scheduled to take effect in 2014. One in three respondents said they could stop offering coverage if the law requires them to provide more generous benefits than they do now, if a tax on high-cost plans takes effect in 2018 as scheduled or if they decide it would be cheaper for them to pay the penalty for not providing insurance....

The uncertainty is a major problem.

The law gives too much power to the HHS.

The decisions are still not clear.

Just keeps getting more and more difficult to create a LIVABLE wage nowadays!

Originally posted by xuenchen
This whole thing could easily lead to lower real-time wages across the board for the average worker.

Not to even consider the massive taxpayer funding necessary to pay for the lower wage earners.

Why would employers dropping health care support, somehow magically lower employee wages?

Could the reason they could drop health care support is because Obama Care is in place and taking care of the workers health needs... Americans health needs?

Honestly I look at an American business and think "why the hell are they providing health care to their employees? Shouldn't that be left up to the employee to find for and pay for their own health care?"
Then I think "Health care in America seems to be quite expensive. That must be a huge expense to American businesses."

reply to post by DaRAGE

Why would employers dropping health care support, somehow magically lower employee wages?

Because the fines are cheaper than paying to provide coverage to their employees, forcing the employees to pay for the required health insurance out of their own pay after the fact.

Could the reason they could drop health care support is because Obama Care is in place and taking care of the workers health needs... Americans health needs?

No, it's because the fines are cheaper than paying to provide coverage to their employees, forcing the employees to pay for the required health insurance out of their own pay after the fact. The Act does not provide coverage to citizens, it merely mandates that they provide proof of it with their tax returns - and makes it cheaper for employers to not provide it than it is for them to provide it.

First the article is from the moonie times.

Why would a business drop insurance. Except that the fine at 50 employees or more is way less than insurance.

We are the only country that has perverted our healthcare system to be provided by the employer. When did you get to choose your insurance -- did you have anything to say about the cheapest policy your employer could find. You can pick and chose in the exchanges.

I am sure that wages will increase if the employer drops coverage because the capitalist system is fair and equitable that way.

We need medicare for everyone.

Here is some right wing christian mother who experiences state medicine.

ayoungmomsmusings.blogspot.com.au...

reply to post by DaRAGE

Why would employers dropping health care support, somehow magically lower employee wages?

Simple math.

By forcing employees into a system that won't necessarily guarantee a low insurance payment.

The employers will continue to use "market price" to determine wages.

Much easier for them with the insurance payment problem out of the way.


Worker #1 now makes $15/hour with insurance.

Employer drops the insurance payment and keeps the wage at $15/hour.

Worker #1 now has to pay the insurance alone.


That = a wage decrease.

Originally posted by DaRAGE
Honestly I look at an American business and think "why the hell are they providing health care to their employees? Shouldn't that be left up to the employee to find for and pay for their own health care?"
Then I think "Health care in America seems to be quite expensive. That must be a huge expense to American businesses."

Yes, absolutely huge.This is one of those roads paved to hell with good intentions. Health care began to be used as a benefit because the premiums are tax-free. Good for everyone, right? So this expanded into dental and eye care, life insurance, and employee assistance programs, disability plans, etc., all tax free benefits. So employees began to feel that this was not so much a benefit as a right. And in some cases, usually with strong unions or government employees, these benefits extended into retirement and also to dependents. .

Now the insurance companies liked this just fine. Why? Because employees, by and large, are a healthy group. They can work. Employers liked this just fine. Originally they could afford $50 per month per employee. And employees liked it because they got it for free and usually never saw a bill.

But then costs began to escalate. In 1977 when I was hired into a good job health care cost $50 per month and I made $1000 a month. The premium was 1/20th of my salary. Thirty years later I was making a lot more, like $5000 a month, but the health care premium was nearing $800 a month, about 1/6th of my salary. As a result of these skyrocketing premiums employers began searching for ways to cut costs, such as a higher deductible.

And you can't just blame it on insurance companies. In our case we formed a consortium with the same kind of employers all around the state to "do it ourseves" and we went broke doing it. Our premiums did not cover actual expenses.

So the whole thing is obviously broken, and now Obamacare has pushed it over the edge. I don't see it recovering, myself, but I'm quite convinced the government can take anything in the world and screw it up beyond all recognition.

Forcing employers who are already paying their salaries, then matching the employees SS and then some genius decided everyone should get "free healthcarE".

Between Medicaid,and still being on mommy and daddies insurance til 26 smart business to drop an expense or lessen their operating costs.

Don't forget now the Government is the largest healthcare provider in the country between medicare that has 70 million and Medicaid that has over 50 million.

IF the left and Obama was serious about lowering healthcare costs they would have merged medicare, and medicaid and loosen regulations that drive those costs up.

Never mind that tho makes too much sense just make employers who are mostly small business who are responsible for over 80% of all job creation in the country to take the burden.

Originally posted by xuenchen
reply to post by DaRAGE

 

Why would employers dropping health care support, somehow magically lower employee wages?

Simple math.

By forcing employees into a system that won't necessarily guarantee a low insurance payment.

The employers will continue to use "market price" to determine wages.

Much easier for them with the insurance payment problem out of the way.


Worker #1 now makes $15/hour with insurance.

Employer drops the insurance payment and keeps the wage at $15/hour.

Worker #1 now has to pay the insurance alone.


That = a wage decrease.

Worker #1 was probably also paying 200 to 400 per month to pay his half of the insuance. He will pay less on the exchanges

If you theory about market wages is true then wages will go up. The employer will be competing for employees.

The idea of the employer providing insurance came about during a wage freeze it stuck.

How many new business will be started because a person is not tied to the sucky job because they have to provide insurance for some family member.

Your arguments are starting to get a little long in the tooth.

reply to post by xuenchen


Administrative leeches? Arent the leeches here the people who stuff their pockets with money they made off cheap labor, while leaving it to the public to cover the costs of the working poor who themselves cant cover them? If the capitalist is an animal preying on the weak, does that not mean more regulation is needed, to create a bottom where conditions are bearable?

reply to post by DaRAGE


"Real wage" buddy .. not wage. Different.

Real Wage is total real income (which includes all benefits)
So if your employer pays $600 a month for your health insurance and your actual income is $3000 a month, you really make $3600 a month.

If your employer stops paying your benefits and you have to take out a personal policy for your family at $600 a month, your "Real Wage" falls to $2400 a month ... an actual loss of $1200 dollars. Losing benefits can be very traumatic for a family.

I've seen studies from various Chamber of Commerce surveys from major cities that indicate after a year of absorbing costs the total number of businesses abandoning insurance could be upwards to 20+% and increasing every year thereafter as insurance premiums are poised to accelerate their inflation. Unless the government adjusts the penalty for inflation, it will soon become much much cheaper to pay the fine than pay for coverage.

reply to post by neo96


They also would have loosened up on some of the requirements of medicaid and medicare. I know some doctors that have dropped all medicaid patients because they require steps that are so burdensome and time consuming it actually takes away from care. They have guidelines for how to do things that ensure the patient or doctor will fail just so that they can refuse payment.

One of the big clinics in my area recently decided that they would start taking medicaid patients for certain services. Medicaid sent them a single sheet of instructions on how to deal with patients for a certain service. The instructions were so unclear that the clinic put off seeing patients for a month because they needed clarification on certain things. After a three hour meeting the schedulers, nurses, and doctors still had a list of thirty five questions. The medicare liaison has refused a second meeting. Now they are refusing payment on services because patients saw doctors in the wrong order. That in turn shifts the cost to the patients. We're talking about people living below the poverty level being stuck with $1,200 to $3,000 in doctor bills because the medicaid office refused clarification on requirements that vary wildly from the accepted and normal practices.

I could go on about things I have heard about dealing with medicare and medicaid. If people think this is going to fix the problem they haven't dealt with the system before.

Originally posted by spyder550

I am sure that wages will increase if the employer drops coverage because the capitalist system is fair and equitable that way.

Except the employer isn't saving the money, they are paying it as a fine, so wages will not increase. Only the burden of the worker does. But I am sure Obama will dip into his own pockets for the middle class now paying all their insurance with no wage increase.

This is great news! Health insurance is a scam.

They deliberately jack up the cost of treatments so the average person cannot afford them, making them believe that they need to be insured.

These are the three stages of the health insurance scam:

1. Make people get insurance, either by manipulation or as a requirement for their employment.

2. Wait until the healthy people start complaining about paying higher premiums to cover those who live unhealthy lifestyles. (This will happen after is becomes compulsory).

3. Make them happy again by dictating what you must eat, how much exercise you must do, how much sleep you must have, how you cannot smoke and everything else they can think of.

It's all about control.

Originally posted by DaRAGE
Why would employers dropping health care support, somehow magically lower employee wages?

In the world of money, (economics, accounting, finance, etc) wage generally means all compensation, so less compensation is less compensation. And actually, the more accurate $5 word there is actually 'remuneration' instead of compensation, so 'less remuneration is less remuneration' or more plainly, less reward is less reward.

There has often been talk in the past of not even ALLOWING employers to purchase healthcare anymore (great idea actually), and to end the practice at the legislative level while also requiring them to switch over to paying their employees the money that they had been spending on them to buy health care. So in that case, people wouldn't see any real decrease in wages.

reply to post by 11andrew34


That would lead to increased incentive to fire or lay off current employees. If the new employee never had health insurance with the company they wouldn"t recieve the extra money. So, it would be cheaper to lay off and rehire.

Interesting. Yet if you actually look into the matter (I know, I know why would ANYBODY actually research something so simple, right?) you'll see that this is nothing unusual and tying it to ObamaCare is somewhat disingenuous. Administering benefits programs cost big money and in my working lifetime (I'm 60) I've seen the level employer contributions drop precipitously. For you youngins out there, it was typical and expected for employers to pay 100% of healthcare when I entered the workforce. Times change.

But if you look at this (go to page 30) you'll see that during the Bush presidency employer-offered health benefits dropped 9% (from 68% to 59%). Not attempting to bash Bush or defend Obama --- two peas in the same pod to me --- just pointing out that things (as usual) are a bit more convoluted than the political rancor would have you believe.

If you read the article they say that the high cost of healthcare is why they are dropping insurance, not Obamacare.

If this is actually true then I think it is probably a good thing Obamacare is a reality.

Companies that reduce employee benefits will struggle to get skilled employees.

Before you let someone do work for you ask the worker if the boss is paying his health insurance. If they aren't, send them on their way and call someone who does. You may think you are saving money by not caring and going with the cheaper(?) guy, but in reality you are just sticking a knife into your ability to earn an honest wage.

Originally posted by jtma508
Interesting. Yet if you actually look into the matter (I know, I know why would ANYBODY actually research something so simple, right?) you'll see that this is nothing unusual and tying it to ObamaCare is somewhat disingenuous. Administering benefits programs cost big money and in my working lifetime (I'm 60) I've seen the level employer contributions drop precipitously. For you youngins out there, it was typical and expected for employers to pay 100% of healthcare when I entered the workforce. Times change.

But if you look at this (go to page 30) you'll see that during the Bush presidency employer-offered health benefits dropped 9% (from 68% to 59%). Not attempting to bash Bush or defend Obama --- two peas in the same pod to me --- just pointing out that things (as usual) are a bit more convoluted than the political rancor would have you believe.

I tend to agree with you. The way it ties into Obama is thus though, without the fine employers would be able to compensate workers more without providing healthcare. Now the money employers would save goes to the government, not the workforce, thanks to Obamacare.

Originally posted by MikeNice81
That would lead to increased incentive to fire or lay off current employees. If the new employee never had health insurance with the company they wouldn"t recieve the extra money. So, it would be cheaper to lay off and rehire.

Clever enough, but I'm sure Senator that between the two of us, we can work out a bill that would anticipate and close such loopholes.