We are now starting to see the beginning of a game of health care Jenga. The problem is the Democrats have seriously constrained themselves on what they can do. Obama set an arbitrary numeric cap of around $900 billion and demanded reform be fully paid for. Conservatives like Baucus, Conrad, and Snowe demanded that health care reform be paid for with only dollars inside the health care system. Sweetheart deals with the the different industries (hospitals, pharmaceutical companies, etc.) eliminated the possibility of producing hundreds of billions of savings with serious system-wide reforms. Fierce opposition to “too much government” solutions or a Medicare-like public option also took some of the biggest money savers off the table.
These many restrictions make it nearly impossible to add to new, meaningful reforms. Without the room to add to the bill, creating compromises becomes extreme difficult. For example, a theoretical compromise for weakening the public option would be to add for liberals more affordability subsidies or improvements in Medicaid. Another example: reducing the excise tax on health insurance benefits could be paid for with the money saved from drugs re-imporation. Neither of these compromises is now possible because of the different restrictions and secret deals.
Really, the only option left for concessions is the removing of things that one group or another find most objectionable. The result is a destructive downward spiral that best can be called health care Jenga: Different groups keep trying to remove building blocks while trying not to knock over the whole towering health care reform bill.
The employer mandate was removed to appease Olympia Snowe. To get the bill under budget, affordability tax credits were slashed. To increase the number of people “technically” insured without spending more money, what is defined as minimum insurance was scaled way back. It now seems that without a public option, progressives may threaten to join conservatives in killing the individual mandate. Block by block, reform is being both reduced and made less stable.
The White House may credit their secret deals with the different stakeholders (i.e. health industry lobbyists) with getting reform this far, but the strict limitations those deals put on possible compromises may prevent it from getting any farther. At least not without America getting left with a very wobbly new system, full of gapping holes.
Showing posts with label Employer Mandate. Show all posts
Showing posts with label Employer Mandate. Show all posts
Why Do Republicans Want Illegal Immigrants To Get Jobs Instead Of Americans? - Updated
To make the current health care reform proposals work there must be some form of an employer mandate to provide health insurance. If there is not one, companies would have a strong incentive to drop coverage knowing the government will help their employees get insurance.
The easiest, best, and simplest way to create an employer mandate is to charge companies a flat fee if they don't offer health insurance. The fee could be some percent of payroll or a set fine multiplied by the number of employees at the firm.
The Republicans don't want a simple employer mandate and instead are demanding it take the form an extremely complex and dysfunctional “free rider” provision. Senator Baucus has given in to their demands and is promoting a byzantine free rider provision. Instead of penalizing companies for not offering health insurance, it would only penalize companies for each employee they have that gets tax credits to help afford insurance on the new exchange. Not only would this idea be a bureaucratic nightmare to enforce, it would provide a powerful financial incentive to only hire people who don't get tax credits to buy individual insurance. This group includes spouses whose partners get good employer health insurance and, of course, illegal immigrants.
Baucus has made it clear that legislation is not going to allow undocumented workers to get tax credits to help afford health insurance. Since they can't get tax credits to buy insurance, employers who hire illegal immigrants won't face any penalty for not offering health insurance. The free rider provision championed by Republicans will provide another large financial incentive to hire illegal immigrants instead of American citizens.
After years of demagoguery from Republicans on the issue of illegal immigration, I'm left wondering: Why are Republicans (and Max Baucus) fighting so hard to encourage employers to hire illegal immigrants instead of working class Americans? The other important question is, of course, are Democrats so afraid of passing a bill without a few Republican votes that they would embrace such a clearly dangerous and stupid idea?
[Another Note: The Republican backed free rider provision would only penalize employers if their employees get tax credits on the exchange, but not if they are on Medicaid (according the the current framework). Medicaid would cover everyone making under 133% of the federal poverty level ($14,404 a year for individuals). Paying an employee one dollar more than $14,404 could increase the cost of employing them by thousands of dollars. The Republican/Baucus free rider provision not only encourages the hiring of illegal immigrants, but also encourages businesses not to pay Americans more than $14,404 a year.]
Updated - Breaking: Baucus' bill will now not let illegal immigrants buy health insurance on the new exchange even if they are willing to fully pay for it themselves. Not only is this a stupid and cruel policy but it is also very expensive. Illegal immigrants will be force to get very expansive emergency room care (which the government will end up playing for) since they are not allowed to buy health insurance.
The easiest, best, and simplest way to create an employer mandate is to charge companies a flat fee if they don't offer health insurance. The fee could be some percent of payroll or a set fine multiplied by the number of employees at the firm.
The Republicans don't want a simple employer mandate and instead are demanding it take the form an extremely complex and dysfunctional “free rider” provision. Senator Baucus has given in to their demands and is promoting a byzantine free rider provision. Instead of penalizing companies for not offering health insurance, it would only penalize companies for each employee they have that gets tax credits to help afford insurance on the new exchange. Not only would this idea be a bureaucratic nightmare to enforce, it would provide a powerful financial incentive to only hire people who don't get tax credits to buy individual insurance. This group includes spouses whose partners get good employer health insurance and, of course, illegal immigrants.
Baucus has made it clear that legislation is not going to allow undocumented workers to get tax credits to help afford health insurance. Since they can't get tax credits to buy insurance, employers who hire illegal immigrants won't face any penalty for not offering health insurance. The free rider provision championed by Republicans will provide another large financial incentive to hire illegal immigrants instead of American citizens.
After years of demagoguery from Republicans on the issue of illegal immigration, I'm left wondering: Why are Republicans (and Max Baucus) fighting so hard to encourage employers to hire illegal immigrants instead of working class Americans? The other important question is, of course, are Democrats so afraid of passing a bill without a few Republican votes that they would embrace such a clearly dangerous and stupid idea?
[Another Note: The Republican backed free rider provision would only penalize employers if their employees get tax credits on the exchange, but not if they are on Medicaid (according the the current framework). Medicaid would cover everyone making under 133% of the federal poverty level ($14,404 a year for individuals). Paying an employee one dollar more than $14,404 could increase the cost of employing them by thousands of dollars. The Republican/Baucus free rider provision not only encourages the hiring of illegal immigrants, but also encourages businesses not to pay Americans more than $14,404 a year.]
Updated - Breaking: Baucus' bill will now not let illegal immigrants buy health insurance on the new exchange even if they are willing to fully pay for it themselves. Not only is this a stupid and cruel policy but it is also very expensive. Illegal immigrants will be force to get very expansive emergency room care (which the government will end up playing for) since they are not allowed to buy health insurance.
Was Grassley's "Death Panel" Talk Obama's Wake Up Call?
Obama has long tried, and so far failed, to reach a bipartisan agreement on health care reform. He has given incredible leeway to Max Baucus to come to some kind of agreement with Chuck Grassley. Obama has been very malleable, willing to concede on several important issues to gain some Republican support.
Until this last week, the concessions demanded by Grassley at least seemed to have an ideological basis. They seemed to be on issues where there was a real philosophical difference on the role of government. The issue of the government run public option, the issue of an employer mandate, the size of subsidies, what new taxes should pay for reform, etc...
But everything changed on Wednesday when Grassley told people to be afraid the Democrats had a secret plan to kill grandmothers. He was attacking a small end-of-life counseling provision which Sarah Palin dubbed “death panels.” Until last week, end of life counseling has never been a partisan or ideological idea. It has been long championed by dozens of Republicans over the years.
Grassley was not fighting against an idea for ideological reasons. He decided to shamelessly fear monger about what should have been a completely noncontroversial proposal. I think Grassley showed that day that he is not and has never been an honest broker during the health care negotiations.
Yesterday at a town hall, Obama made a statement which seemed to be directed squarely at Senator Grassley. Obama said,
PS, it appears that Grassley knows Obama was directly going after him.
Until this last week, the concessions demanded by Grassley at least seemed to have an ideological basis. They seemed to be on issues where there was a real philosophical difference on the role of government. The issue of the government run public option, the issue of an employer mandate, the size of subsidies, what new taxes should pay for reform, etc...
But everything changed on Wednesday when Grassley told people to be afraid the Democrats had a secret plan to kill grandmothers. He was attacking a small end-of-life counseling provision which Sarah Palin dubbed “death panels.” Until last week, end of life counseling has never been a partisan or ideological idea. It has been long championed by dozens of Republicans over the years.
Grassley was not fighting against an idea for ideological reasons. He decided to shamelessly fear monger about what should have been a completely noncontroversial proposal. I think Grassley showed that day that he is not and has never been an honest broker during the health care negotiations.
Yesterday at a town hall, Obama made a statement which seemed to be directed squarely at Senator Grassley. Obama said,
So when I have people who just a couple of years ago thought this was a good idea now getting on television suggesting that it’s a plot against grandma or to sneak euthanasia into our health care system, that feels dishonest to me.To my knowledge this is the first time Obama has criticized one of the Republicans who are part of Baucus' “Gang of Six.” This could be the wake up call Obama needed. Proof that Grassley was not delaying reform for ideological reason but to simply hurt Democrats.
PS, it appears that Grassley knows Obama was directly going after him.
NFR Throws Tantrum Over Small Employer Mandate
Tracy Mullin, the president of National Federation of Retailers, sent an over the top letter to its members asking them to fight against a very small employer mandate penalty.
The employer mandate that is part of the Senate HELP Committee's bill is very modest. If a firm with more than 25 workers does not provide health insurance benefits, it will be required to pay a penalty of $750 a year for full time employees and $375 for part time employees.
In the absolute worst case scenario (an employee working for federal minimum wage and exact minimum number of hours a year to be declare full time), the penalty would add only 5% to the cost of hiring an employee. For the vast majority of employees of large retail firms, it would only increase the cost of employing them by 2-3%. And that is only for firms who do not and do not plan to offer their employees some form of health insurance.
She attacks Wal-Mart for agreeing that an employer mandate might need to be part of health care reform. In the letter she makes ridiculous claims that the minor employer mandate “could quickly push our economic recovery back decades” and “could have long-lasting, devastating consequences to retailers throughout the country.”
Really, Ms. Mullin? That small percent-increase in cost will devastate retailers? I find that claim very hard to take seriously. For example, when the federal minimum wage is raised from $6.55 to $7.25, it will increase the cost of a full time employee by nearly twice the proposed penalty.
It is understandable that many retailers, who don't help their employees get health insurance, don't want to pay a small penalty. But it would be neither “catastrophic” or “devastating.” It is the over the top, sky is falling rhetoric that endangers health care reform. If you are serious about working “diligently on real solutions that would help fix our health care system,” you state your concerns, but tone down your childish temper tantrums.
The employer mandate that is part of the Senate HELP Committee's bill is very modest. If a firm with more than 25 workers does not provide health insurance benefits, it will be required to pay a penalty of $750 a year for full time employees and $375 for part time employees.
In the absolute worst case scenario (an employee working for federal minimum wage and exact minimum number of hours a year to be declare full time), the penalty would add only 5% to the cost of hiring an employee. For the vast majority of employees of large retail firms, it would only increase the cost of employing them by 2-3%. And that is only for firms who do not and do not plan to offer their employees some form of health insurance.
She attacks Wal-Mart for agreeing that an employer mandate might need to be part of health care reform. In the letter she makes ridiculous claims that the minor employer mandate “could quickly push our economic recovery back decades” and “could have long-lasting, devastating consequences to retailers throughout the country.”
Really, Ms. Mullin? That small percent-increase in cost will devastate retailers? I find that claim very hard to take seriously. For example, when the federal minimum wage is raised from $6.55 to $7.25, it will increase the cost of a full time employee by nearly twice the proposed penalty.
It is understandable that many retailers, who don't help their employees get health insurance, don't want to pay a small penalty. But it would be neither “catastrophic” or “devastating.” It is the over the top, sky is falling rhetoric that endangers health care reform. If you are serious about working “diligently on real solutions that would help fix our health care system,” you state your concerns, but tone down your childish temper tantrums.
How The Employer Mandate and Benefit Tax May Save The Public Option
While the public option is the part of health care reform which has received the most press, there are several other important, contentious issues which are making a bipartisan health care reform bill agreement elusive. Two difficult issues are the employer mandate and a new tax on employer-offered health care benefits.
Republicans are strongly against even the minor employer mandate in the HELP Committee bill. The problem is the employer mandate is currently the most cost effective way to expand coverage in the bill. It was almost solely responsible for reducing the CBO scoring of the HELP committee bill's cost per uninsured individual covered by roughly 50%. It also stops the politically damaging determination that millions of Americans will “lose” their employer coverage (even though they would still be getting coverage from the health care exchange). Without the employer mandate, they will need to dramatically slash subsidies offered to help people afford insurance to get a bill under $1 trillion.
The possible “compromise” Republicans might accept is a “free rider” provision that employers must pay for workers on Medicaid or getting insurance subsidies. This is strongly opposed by Wal-Mart (which for good reason supports the employer mandate instead) and presumably therefore unpopular with the two Democratic senators from Arkansas. Given how the “free rider” provision would disproportionately hurt low wage employers, it would be an incredibly tough pill for both liberal and conservative Democratic senators to swallow.
A new tax on employee health insurance benefits in any form is amazingly unpopular with the American people. It is a proposal that makes Democrats on the entire political spectrum very nervous. Not surprisingly Harry Reid was recently forced to tell Senator Baucus to drop the proposal. The Senate Finance Committee has started fresh the search for a possible funding source.
Yet, Republican Senator Grassley continue to push for this very unpopular tax on health insurance benefits. Grassley demands that all money for reform comes from the health care system. If Republicans are unwilling to agree to a new tax besides the one on health benefits, it will make a bipartisan bill unobtainable.
The more likely health care will be passed with a purely partisan vote, the more likely that it will include a real public option. If it were the sole point of contention standing in the way of bipartisanship, the pressure from centrist Democrats would probably be enough to kill it. At issue though are the other demands made by Republican senators which are unacceptable some liberal, moderate, and conservative Democrats. The public option may not be the issue which kills bipartisanship, but it should strongly benefit from its death.
Republicans are strongly against even the minor employer mandate in the HELP Committee bill. The problem is the employer mandate is currently the most cost effective way to expand coverage in the bill. It was almost solely responsible for reducing the CBO scoring of the HELP committee bill's cost per uninsured individual covered by roughly 50%. It also stops the politically damaging determination that millions of Americans will “lose” their employer coverage (even though they would still be getting coverage from the health care exchange). Without the employer mandate, they will need to dramatically slash subsidies offered to help people afford insurance to get a bill under $1 trillion.
The possible “compromise” Republicans might accept is a “free rider” provision that employers must pay for workers on Medicaid or getting insurance subsidies. This is strongly opposed by Wal-Mart (which for good reason supports the employer mandate instead) and presumably therefore unpopular with the two Democratic senators from Arkansas. Given how the “free rider” provision would disproportionately hurt low wage employers, it would be an incredibly tough pill for both liberal and conservative Democratic senators to swallow.
A new tax on employee health insurance benefits in any form is amazingly unpopular with the American people. It is a proposal that makes Democrats on the entire political spectrum very nervous. Not surprisingly Harry Reid was recently forced to tell Senator Baucus to drop the proposal. The Senate Finance Committee has started fresh the search for a possible funding source.
Yet, Republican Senator Grassley continue to push for this very unpopular tax on health insurance benefits. Grassley demands that all money for reform comes from the health care system. If Republicans are unwilling to agree to a new tax besides the one on health benefits, it will make a bipartisan bill unobtainable.
The more likely health care will be passed with a purely partisan vote, the more likely that it will include a real public option. If it were the sole point of contention standing in the way of bipartisanship, the pressure from centrist Democrats would probably be enough to kill it. At issue though are the other demands made by Republican senators which are unacceptable some liberal, moderate, and conservative Democrats. The public option may not be the issue which kills bipartisanship, but it should strongly benefit from its death.
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