Anthony D. Martin
In a stunning revelation Wednesday, several top U.S. corporations are seriously considering dropping employee health insurance coverage in light of what they see as the inevitable consequence of ObamaCare--skyrocketing costs.
The companies state that after their legal experts poured over the thousands of pages in the new law, it will cost them less to pay the fines for not providing healthcare coverage for employees than continuing to provide employer-paid health insurance benefits.
As a side-note to the announcement, the companies maintain that ObamaCare will result in a dramatic increase in expenses for providing employee coverage, with added costs skyrocketing to multi-billions of dollars.
According to Business Record:
Additionally, the penalties to businesses for not offering coverage are less expensive than the cost of providing insurance, she said. "But for those that aren't providing coverage now, this is a huge burden to them. And for employers that have a lot of employees working 30 hours (the threshold to be considered full- ime), you may have a lot of businesses cutting them back to 29 hours."
Business Record maintains that despite this fact most companies will probably try to continue to provide coverage.
But a report issued today in Fortune Magazine and reported by CNN indicates that the dire warnings of ObamaCare critics concerning the consequences of approving the costly legislation are in fact well-founded.
The report points to internal documents from AT&T, Verizon, John Deere, and several other large corporations which show that executives are, in fact, looking at the option of dropping healthcare coverage for employees due to what they are sure will be unsustainable increases in costs. These costs will be so prohibitive that it would benefit the corporations to pay the government fines instead:
Internal documents recently reviewed by Fortune, originally requested by Congress, show what the bill's critics predicted, and what its champions dreaded: many large companies are examining a course that was heretofore unthinkable, dumping the health care coverage they provide to their workers in exchange for paying penalty fees to the government.
That would dismantle the employer-based system that has reigned since World War II. It would also seem to contradict President Obama's statements that Americans who like their current plans could keep them. And as we'll see, it would hugely magnify the projected costs for the bill, which controls deficits only by assuming that America's employers would remain the backbone of the nation's health care system.
Hence, health-care reform risks becoming a victim of unintended consequences. Amazingly, the corporate documents that prove this point became public because of a different set of unintended consequences: they told a story far different than the one the politicians who demanded them expected.
This information will most certainly be added motivation for those who are intent on repealing ObamaCare following the November 2010 midterm elections, or at the very least refusing to fund the program which was passed by Congress as an appropriations measure.
For commentary on the issues of the day, visit my blog at The Liberty Sphere.
May 5, 2010