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Affordable Care Act is good for workforce

3/6/2013

Cityview recently published one in a series of attacks on the nation’s health care law, the Affordable Care Act, (Guest Commentary, Jan. 10, 2013) by the right-wing publishing house calling itself the Pacific Research Institute. Opponents such as author Sally C. Pipes continue to misrepresent the law as a job-killer. Her specific complaint is about regulations requiring companies with 50 or more employees to offer coverage to full-time workers starting in 2014.                

However, even prior to implementation of a mandate, most workers now get health insurance through employers. Some 160 million Americans get coverage through their jobs now. Pipes fails to even mention generous federal tax credits being made available to employers who provide health coverage, have no more than 25 employees and whose annual wages average less than $50,000. Those credits will rise in 2014 to a maximum of half of the cost of premiums offered by the smallest businesses, defined as those with 10 or fewer workers.            

She also fails to include the new temporary reinsurance program for retirees over age 55 and not yet eligible for Medicare. This program will reimburse up to 80 percent of health care expenses between $15,000 and $90,000 per retiree. The intent of the law is to allow employers to use these reimbursements to reduce the overall cost of providing medical coverage.               

Most importantly, Pipes ignores completely the impact of state insurance exchanges, which would operate as a marketplace to tighten competition among health insurance providers and thereby bend the cost curve downward for employers and individuals alike.                

Health costs for uninsured workers and their families are passed on to taxpayer-funded programs, like Medicaid, which are designed to assist low-income residents, not full-time workers whose employers are getting by on the cheap and defaulting to the government as their health insurer at no cost to them.                

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The data shows existing employer mandates have been working for years in places as diverse as Hawaii, Massachusetts and San Francisco, Calif. When businesses are required to comply, they adjust to the new rules as applied to all, and many companies experience lower turnover when health benefits are made available.               

The bottom line is the employer mandate will even the playing field for small businesses that already provide health coverage but are currently forced to compete with companies that do not. The losers here are companies that choose to rely on poorly-paid employees without benefits to provide the bulk of their workforce.               

An employer mandate will add a bit to some companies’ costs of doing business, because the ACA sets out a national commitment to get Americans covered with health insurance. In the end, the mandate will insure some of Iowa’s hardest working, lowest paid employees.

Sen. Jack Hatch
–Des Moines

 

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