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One of the penalties for refusing to participate in politics
is that you end up being governed by your inferiors. -- Plato
(429-347 BC)
Wednesday, October 22, 2014
Never Ending Obamacare Story: Premium Increases | To Escape Health Law’s Penalties Companies Cutting Health Coverage And Hours
Editorial Cartoon by William Warren
While liberals crow about Obamacare and try to declare any debate over it over, barely a day goes by without another story detailing the adverse effects of this unpopular law on Americans.
Once again, despite Democrats’ repeated promises that the law would lower premiums, news comes of rates going up. The AP reports, “North Carolina's largest health insurer says rates will rise by more than 13 percent on average next year for buyers of individual Affordable Care Act policies. Blue Cross and Blue Shield of North Carolina discussed the prices Wednesday. . . . Aside from ACA plans, the insurer is maintaining pre-existing plans that don't conform to the Affordable Care Act's requirements but customers wanted to keep. Rates for those plans will rise by an average of 13 to 19 percent, depending on when they were sold.”
Meanwhile, businesses are responding to the poorly conceived incentives created by Obamacare, resulting in people losing their existing insurance plans, just as Republicans warned they would. The Wall Street Journal writes, “With companies set to face fines next year for not complying with the new mandate to offer health insurance, some are pursuing strategies like enrolling employees in Medicaid to avoid penalties and hold down costs. The health law’s penalties, which can amount to about $2,000 per employee, were supposed to start this year, but the Obama administration delayed them until 2015, when they take effect for firms that employ at least 100 people. Now, as employers race to find ways to cover their full-time workers while holding a lid on costs, insurance brokers and benefits administrators are pitching a variety of options, sometimes exploiting wrinkles in the law.
“The Medicaid option is drawing particular interest from companies with low-wage workers, brokers say. If an employee qualifies for Medicaid, which is jointly funded by the federal government and the states, the employer pays no penalty for that coverage. . . .
“Locals 8 Restaurant Group LLC, with about 1,000 workers, already offers health coverage, and next year plans to dial back some employees’ premium contributions. That is because an employer can owe penalties if its coverage doesn’t meet the law’s standard for affordability. . . . But the company, which is based in Hartford, Conn., hopes to reduce its costs by offering eligible employees a chance to enroll in Medicaid . . . . The government program . . . saves money for Locals 8, said Chief Executive Al Gamble. ‘The burden gets shifted to Medicaid,’ he said. . . .
‘We’ve got to be careful about not fooling ourselves into thinking everybody wins,’ said Matt Salo, executive director of the National Association of Medicaid Directors. ‘The cost to the taxpayer does go up significantly.’”
The WSJ adds, “Another idea gaining ground with employers is offering bare-bones, or ‘skinny,’ health plans that cover preventive care but exclude major benefits like hospital coverage. . . . Making such plans available allows employers to avoid the approximately $2,000-per-employee penalty for not offering coverage to at least 70% of their full-timers. . . .
“Ruiz Protective Service Inc., a 400-employee firm that provides security services and polygraph tests, plans to start a skinny plan in January. The company can’t afford the about $2,000-per-worker penalty or traditional insurance, according to owner Hector Ruiz, who said the new plan ‘will satisfy the law and not put us out of business.’ . . .
“Some employers are mixing strategies to hold down costs. Garden Fresh Restaurant Corp., parent of the 128-unit Sweet Tomatoes and Souplantation restaurant chains, has been hiring part-time workers as full-timers have left. The law doesn’t require companies to offer coverage to part-timers working less than 30 hours a week. Next year, Garden Fresh plans to offer full-timers a high-deductible plan that meets all of the law’s requirements. To limit enrollment it won’t cover spouses or domestic partners who have coverage available through their own employers.
“‘We’ve been able to mitigate quite a bit of the costs,’ said CEO John Morberg. Garden Fresh expects only about 20% of previously ineligible front-line restaurant workers to sign up for coverage. ‘If it exceeds that, we’ll have to go to the menu board to raise prices,’ Mr. Morberg said.”
So while health insurance premiums continue to go up (including on Obamacare plans), the regulations, mandates, and fines imposed on employers by Democrats’ health care law are causing businesses to dump employees onto Medicaid, offer plans with sharply reduced coverage, drop coverage for spouses, and cut working hours.
Tags:Never Ending Story, Obamacare, problems, Premium increases, penalties, Business, laying off workers, cutting hours, editorial cartoon, William WarrenTo share or post to your site, click on "Post Link". Please mention / link to the ARRA News Service. and "Like" Facebook Page - Thanks!
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