The decision in Washington last week to postpone implementation of the employer mandate to provide health care insurance further challenges the struggling North Country economy. The controversial legislation to reform how Americas health care is delivered and paid for has been moving forward in fits and starts as government attempts to translate the grandiose plans of Congress and the President into actionable rules to govern an extremely large marketplace.
The administration added a year to the deadline requiring employers of 50 or more workers to report whether they provided federally approved health care and which of their employees chose coverage and which did not. Since the 2010 Affordable Care Act passed, employers have been struggling with the unquantifiable consequences of the law.
Employers are reacting to the law by tinkering with the definition of a full-time employee. The traditional 35 to 40 hour a week job was considered full time.
The Affordable Care Act reduced that threshold to 30 hours. As a reaction, employers have redefined their workplaces by limiting certain classes of workers to less than 30 hours to protect themselves from expenses and penalties under the law.
Smaller businesses have spent plenty of what should be productive time deciding whether growth past the 50-employee threshold is worth the added costs of medical benefits for the entire workforce. Fearing the expense of providing acceptable health care or paying a fine, many small businesses have stopped growing or have evaded the law by outsourcing.
While the employer mandate decision is a relief to some business interests, individual employees are being treated unfairly. Subsidies are available for workers to comply with the individual mandate only if their employer fails to offer benefits. Instead of following the prescription of the law by requiring employers to report whether each worker is full- or part-time status, the nature of the employers health plan and whether or not and why an employee decided not to take advantage of the health plan offered, the government says it is simply going to take the employees word that they are eligible a health care subsidy. That is unfair to almost all Americans who do not have access to expert advice given the complexity of the law.
The decision announced in a series of blog posts and massive rule books (more than 600 pages) further assumes no one will game the system to take advantage of a federal subsidy for health care insurance. The rules are an admission that government cannot gather and process the data required to means test everyone who joins an insurance exchange.
The decision to exempt businesses from providing required health care plans and taking every employees word as to whether or not he or she should receive a federal subsidy is an admission that government cannot enforce the law Congress provided the President. Without means testing, the economy could embark on another economic bubble similar to the real estate boom of the last decade when mortgages were approved for just about anyone without any effective means testing such as verification of earnings. When no one monitors a market, no one should be surprised when the implosion occurs.
This is the last thing we need in Northern New York, a region that is still missing the benefits of the modest economic upswing across the country. We are plagued with an economy almost solely dependent upon the military and agriculture. Our private sector marketplace is dominated by small businesses that need to know what the federal health care requirements will be in 2015. And the uncertainty will delay economic growth we so desperately need.
What is irritating about these two decisions is the blatant political self-service by the President and the Democratic Party to blunt controversy over the Affordable Care Act. They want to dampen fear and distrust in the political marketplace next fall.
If you can apply for health insurance with immunity and employers are exempt from the law for another year, there are fewer short-term political issues plaguing Democratic senators facing re-election. They do not want to answer to their constituents about why the heart of the act is so unworkable.
They do not want to defend the failure of the legislation. Instead, they want to promise that better days will come with an unfair and illegal postponement of a law that just may not work as constructed.