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October 15 2014

New Workweek Initiative Highlights Problem in ObamaCare

Hadley Heath

The White House has unilaterally delayed enforcement of employer mandates in ObamaCare.  But eventually, these mandates are going to kick in.  Unless the Administration issues another executive delays, businesses of more than 200 workers will be subject to the employer mandate on January 1, 2015, just about 11 weeks from now. Then, on January 1, 2016, businesses of 50 to 200 workers will face the same mandates.

The mandate, and its related penalties, are a little bit complicated. But here's one key aspect of the mandate that is create big problems for American workers.  ObamaCare defines "full time work" as 30 hours per week. Effectively this means that employers can reduce the number of hours that employees work (below 30 per week) and avoid the costs associated with having to offer full-time workers ObamaCare-compliant insurance coverage. For workers, this means working fewer hours -- for a smaller paycheck -- and losing employer-sponsored insurance. It's a lose-lose situation. 

Importantly, people on all sides of the aisle have criticized the employer mandate because of the way it will negatively impact workers and the broader economy. Left-leaning groups like the Urban Institute have said that on top of its economic consequences, the employer mandate doesn't offer much benefit in terms of expanded insurance coverage. The Mercatus Center recently released a report called "The ACA and the New Economics of Part-Time Work," which Rachel blogged about here and which shows how the law will push more Americans--particularly more American women--reluctantly into a part-time status.

Another effort to raise awareness about ObamaCare's impact on employment is called "More Time for Full Time." It features this moving video:

 

ObamaCare's perverse employment incentives are just one of the many ways that this law is backfiring on Americans.  Eliminating or reforming the employer mandate may offset some of the negative consequences of the law, but it won't be enough.  ObamaCare's entire approach is mandate-centric, and depends on a web of government requirements -- on individuals, on employers, and on insurers -- that limit choices. This leads to distorted incentives and real harm to our economy, our freedoms, and the quality of our health care. 

That's why we need to repeal ObamaCare and start over by focusing on developing the next, better health reform package, that focuses on market competition, price transparency, and individual consumer choice to reshape the health insurance marketplace without harmful disincentives for employment or the economy at large. This week, during Health Care Solutions Week, we are doing just that by highlighting what those patient-centered, free-market solutions might be. 

Health reform shouldn't result in slashed hours, reduced pay, or limited choices in plans, doctors, or care. Americans deserve better.

Independent Women's Forum is an educational 501(c)(3) dedicated to developing and advancing policies that aren’t just well intended, but actually enhance people’s freedom, choices, and opportunities. IWF is the sister organization of the Independent Women’s Voice.​
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