by
LAS
The
GOP-dominated House has yet again passed a bill to delay or gut key
provisions of the PPACA (aka Obama-Care) law. This week they passed
bills to delay implementation of two key provisions, the individual
mandate and the employer mandate (for
businesses
with 50 or more workers).
First
of all, even though the House has made several attempts to delay or
gut provisions of the reform law, it is very unlikely that the Senate
will even discuss comparable bills on the floor. In fact, the House
has voted 37 times already to “repeal
or defund at least part of the health-care law, including three times
to annul the entire measure” since 2010.
The
Obama administration said in a statement that the measure to delay
the employer mandate is “unnecessary,” and legislation postponing
the individual requirement “would raise health insurance premiums
and increase the number of uninsured Americans.”
However,
House members of the GOP ran on promises to delay or defund PPACA in
2010 or 2012, and so they wish to make a little political hay during
the summer months by keeping the issue on the House floor.
But
my question is more about who is behind all these attempts to gut the
bill. The key is the the employer mandate applies to companies with
50 or more employees. Specifically, companies that may have thousands
of employees.
What
many Americans may not know is that the PPACA law includes something
called the non-discrimination clause. This has nothing to do with the
color of a policy-holder's skin or what religion he or she believes
in.
As
it is now, companies can design deluxe healthcare plans for executive
employees,as long as the plan was fully insured. But the
non-discrimination clause in Obama-Care applies to ALL group
healthcare plans, in terms of eligibility or benefits. The fact is
that current healthcare plans treat different groups of employees
differently. Most people are aware that the top brass gets the best
perks package in the company. But most people may not be aware that
even their healthcare plans are different, and that the PPACA
specifically bars this and penalizes this practice.
First
let us define the term “highly compensated” employees. This group
includes the five highest-paid officers of the company, the
shareholders who own 10 percent or more of the company, and all
employees among the top 25 percent of all the company's employees.
Violators
of the non-discrimination rules will be subject to stiff fines. This
starts at $100 per day, per “failure penalty” – which will
likely apply to each NON-highly-compensated employee who is left out
of the cushy coverage plans. The company is also vulnerable to a
civil lawsuit to compel it to provide the same upscale coverage plan
to the non-covered employees.
Multiply
that $100 per day per non-covered employee for a large multinational
corporation, and you are talking about a significant hit to the
corporate pocketbook. For a company with say, 500 employees, this
easily adds up to a fine of $37,500 PER DAY. This is where I believe
the pressure is coming from on House members to keep trying to negate
provisions of the PPACA law.
Corporate
America really believes that the executive class has to be lured to
work for a given company with the most extraordinary gold-plated
perks of every kind. Not being able to offer a healthcare plan that
has no deductibles and no copays seems like a small loss when they
are offering a company car, country club and health club and golf
club memberships, the proverbial key to the executive washroom, stock
options, and much more.
The
employer mandate is being delayed for one year with White House
permission. And the government has stated that there will be a
phasing-in period where employers will be given time to make
adjustments before the government begins sanctioning those that do
not comply. But still I would not be surprised if corporate America
tries to get all current healthcare plans to be grandfathered under
the law, thereby escaping all sanctions and fines entirely.
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