More and more employers, as they try to determine their responsibilities under Obamacare, are discovering serious problems with the implementation of the new law. Of course, if anyone other than the proponents of the law were involved in its drafting, many of these glitches could have been resolved before the law passed.
As you know, employers with more than 50 employees must provide health insurance to each full-time employee, and said insurance must be “affordable”, or, the employer must pay a penalty. Sounds pretty simple, doesn’t it? Well, not exactly.
In the real world, a full time employee is one who works 40 hours or more each week, but, not in the world of Obamacare. In that world, a full time employee is one who works 30 hours or more each week.
Retailers, restaurants, and other companies that rely on seasonal, temporary and other workers with flexible schedules, say it”s hard to figure out who is a full-time worker. That could cause the employer to enroll and drop them from coverage, potentially churning them through new state-run insurance exchanges or the Medicaid federal-state program for the poor, as their hours fluctuated.
Employers are also struggling with the “affordable” portion of the law. Forgetting for the moment that no insurance will be affordable once the Department of Health and Human Services finishes defining the mandates of what coverage must be in a plan, there is a bigger problem.
To be “affordable” the plan that is offered must be roughly 9.5% of an employee’s household income. But, there is no way an employer can determine household income because asking an employee to provide information concerning the income of the employee’s spouse and dependents would be a privacy violation. And, were that not enough, how could an employer verify the information given by the employee, or monitor it as spouses/dependents change or lose their jobs?
Remember, if anything is incorrect in any of the above calculations, the employer will face a $2000 per year, per employee penalty.
“You can keep your insurance if you like it”. I think not. Employers will simply drop coverage entirely, dump their employees into the exchanges, and pay the penalty.
Does anyone wonder if that was the plan all along?