New ObamaCare Penalty Discovered: Employers Will Be Fined if Health Care Is Considered Unaffordable by Gov’t
Posted By Vicki McClure Davidson on May 25, 2010
A new punitive penalty has been unearthed in the unpopular ObamaCare… employers will be subject to steep fines for providing health care benefits to employees if it is determined that the cost is too high for an employee.
How employers are suppose to make that determination is left unanswered. Since employers, many who are struggling to keep afloat, are not permitted to ask employees about how much they money they earn or have access to from outside that place of employment — income from a spouse or child, alimony, child support payments, a second job, income from a property rental, lottery or gambling winnings, interest from savings, stock and mutual funds dividends, royalties — the Obama administration has either set up America’s employers for a fall or honestly had no idea how this would impact them.
I vote for the first.
From New York Times, Study Points to Health Law’s Penalties:
About one-third of employers subject to major requirements of the new health care law may face tax penalties because they offer health insurance that could be considered unaffordable to some employees, a new study says.
The study, by Mercer, one of the nation’s largest employee benefit consulting concerns, is based on a survey of nearly 3,000 employers.
It suggests that a little-noticed provision of the law could affect far more employers than Congress had assumed.
In the raucous debate over health care, Democrats and Republicans focused on a provision under which employers would generally have to offer coverage to employees or pay penalties, starting in 2014.
As they study the law, employers are discovering another provision that got much less attention. If a company offers coverage but requires any full-time employees to pay premiums that amount to more than 9.5 percent of their household income, the coverage is deemed unaffordable, and the employer may have to pay a penalty.
A goal of the law, pushed through Congress by President Obama and Democratic leaders with no Republican support, is to give all Americans access to affordable insurance.
The Mercer survey found that one-third of employers had some workers for whom coverage might be “unaffordable,” meaning that the workers’ share of premiums — in the absence of federal assistance — would consume more than 9.5 percent of their household income.
Employers with fewer than 50 employees are generally exempt from penalties.
Beth Umland, Mercer’s research director for health and benefits, said employers with 50 or more employees were more likely to offer unaffordable coverage than to offer no coverage at all.
Tracy Watts, a partner in Mercer’s Washington office, said it would be difficult for employers to know in advance exactly how many workers might find their health plans unaffordable.
“Employers rarely have access to information on their employees’ household income,” which may include the earnings of a spouse or children, interest from savings accounts and dividend income from stocks and mutual funds, Ms. Watts said.
If an employer’s health plan is deemed unaffordable, the worker may qualify for a federal tax credit, or subsidy, to buy coverage in a new state-based marketplace known as an insurance exchange. A person claiming a credit must disclose income information to the exchange. The exchange will then notify employers if any of their workers qualify for subsidies.
Democrats say the subsidies will be a boon to low-wage workers. But the subsidies can also lead to monetary penalties for employers.
An employer offering unaffordable coverage is subject to a penalty of $3,000 a year for each full-time employee who gets government assistance to buy insurance in an exchange. The maximum penalty is $2,000 times the total number of full-time employees in excess of 30.
Andy R. Anderson, an expert on employee benefits at the law firm Morgan Lewis, said, “A lot of employers, particularly those with low-wage work forces, will run into difficulty with the affordability requirement.”
Retailers and restaurants with large numbers of low-wage workers may be most affected.
Related reading:
Legal Insurrection: Health Care Cost Report Deliberately Held Back? Update: Denial. and The Numbers Were A Lie All Along: and He Who Controls The Health System, Controls “Information”
Uncommon Knowledge, Big Government: US Taxpayers Pay for Germany’s Socialized Medicine – and Other Terrible News
GayPatriot: Obamacare means longer waits in emergency rooms
On My Watch — The Writings of SamHenry: Who Do we Trust Now? True Cost of Government Health Care Suppressed in Two Administrations
Radio Vice Online: Obamacare…more unintended consequences
Frugal Café Blog Zone: What Now? Obama Media & Team Obama Failed to Report Automatic Paycheck Deduction Hidden in ObamaCare Health Bill (video) and Congress Suddenly, Literally Faced with Crappy ObamaCare: “Unintentional” Language in Bill May Force Congressional Members to Give Up Their Own Platinum Packages & Be Part of the American Public and ObamaCare “Fine Print” Nightmare Continues: Now 60 Doctor-owned Hospitals Canceled Because of Democrats’ New Oppressive Health Law, Thousands of Jobs Killed and No Surprise Here: Obama’s Promises Missing from Health Care Bill
Patterico’s Pontifications: Congress May Have “Unintentionally” Lost Their Current Coverage by Voting for ObamaCare — What Do the “Intentionalists” Have to Say About That?
City on a Hill Political Observer: Rob Andrews on healthcare: “We didn’t explain it well”
Mcnorman’s Weblog: Baffled by Health Plan? So Is Congress
Market Wire, Milken Institute: D.C.’s Failure to Contain Medical Costs Could Deplete Gains of Middle-Class, According to Stephen Nyce and Sylvester Schieber in Latest Milken Institute Review
Nice Deb: Media Narrative Takes Another Hit: Poll Shows 4 In 10 Tea Partiers Are Dems Or Independents
Gateway Pundit: Commie Official: Without the Communist Party, Obama’s OFA Group Could Have Easily Disbanded and Now We Know… Obamacare Includes 3.8% Tax On Home Sales For All Americans …Update: Maybe Not and The “Giddy” Is Gone… Dem’s Health Care Plan Will Cost Taxpayers BILLIONS More Than Promised (Video) and State-run media comes clean… and First State Opts Out of Abortion Funding in Dem’s Nationalized Health Care Bill and Crazy. Obama Says Health Care Law Already Helps Millions in US
Flopping Aces: Get Ready For The National Sales Tax As ObamaCare Makes It More Attractive For Businesses To Stop Growing
Pundit & Pundette: More goodies hidden in Nancy’s fridge
FOX News: Report: Health Overhaul Will Increase Nation’s Tab
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The large employers have already figured out it is less costly to pay the fine than cover their employees. One down for the private insurers. One down for small business.
Now with this new revelation, no need to worry about big business per the above. If they do retain insurance for their employees, they usually offer a range of plans. 2nd down for small business.
See a pattern here? Small business is dead in the water. Even an idiot knows that small business is the incubator for job growth. The democrats are just plain greedy and can’t see the woods for the money trees.
I am relieved that polls show so many want this cash casserole repealed. I’m ready with my posters, walking shoes and megaphone to hit the streets on this one.
Just more bad news about a bad bill from a bad government – I’ve never wanted to vote so bad in my life.
When will this nightmare of “finding” more rules, taxes, mandates, fines, penalties stop? I thought the whole premise of Obamacare was to bring down costs. These elected maniacs in Wash. DC have become drunk with power.
November is important – all who love America must vote these crooks out.
for tinnitus…