EMPLOYMENT AND PRIVATE INSURANCE
Have you ever stopped to think – “Why do Americans buy health insurance through their employers?” We don’t buy our home, auto, or life insurance this way.
The truth is that tax laws dating back to the 1950’s give employers a tax advantage to offer health insurance. If individuals buying their own health insurance were given this same tax advantage, people might choose to leave their office pool to find more and better choices.
But instead of making insurance markets more fair and accessible, the 2010 health reform doubles down on the employer-centric system, punishing employers who don’t offer government-approved insurance.
PREMISE: Employers could offer insurance that met the new government standards without impacting their hiring and workforce decisions.
HOW IT’S WORKING: The law’s regulatory and cost burdens on employers threaten to reduce employment, both by reducing hiring and shifting full-time jobs to part-time.
- The Congressional Budget Office has predicted the health law will reduce the number of full-time jobs in our economy by 2.5 million by the year 2024, and will slow growth in wages by 1 percent. (The Hill)
- Other estimates paint an even bleaker picture, suggesting that the equivilent of 4 million full-time jobs will be destroyed. (Mercatus Center)
- In some cases, instead of laying workers off, companies have simply cut back on employees’ hours. Changing full-time workers to part-time can allow companies to avoid the law’s mandates, but leaves workers without health benefits at work. Restaurant and grocery franchises like Wendy’s, Taco Bell, Red Lobster, Olive Garden, and Kroger have taken this approach, affecting thousands of workers. Another affected group are teachers at community colleges who have involuntarily been converted to part-time workers in an effort to avoid ObamaCare’s burden. (List of 10 job loss stories)
- Small businesses report significant effects: They are hiring fewer people, and in fact cutting jobs. According to a Gallup poll of small businesses, 41 percent of them said they’d frozen hiring as a result of the health law. Another 19 percent said they’d reduced staff as a result of the law. Some firms are cutting back the hours that workers work, in order to change them over to part-time status and avoid the mandates associated with the law. Other firms are passing along the higher costs directly to workers themselves. (CNBC)
- According to the New England Journal of Medicine, employers are seeking ways to limit their workers' eligibility for health care coverage and shift more costs to them.
- Mmployers are requiring workers to pay more for their healthcare and come are dropping coverage of spouses and children. (Bankrate)