Obamacare fallout: Part-time employees losing their health insurance
With Obamacare now about 10 months from taking effect, get used to more stories like this one from the Orlando Sentinel:
Universal Orlando plans to stop offering medical insurance to part-time employees beginning next year, a move the resort says has been forced by the federal government’s health-care overhaul.
The giant theme-park resort, which generates more than $1 billion in annual revenue, began informing employees this month that it will offer health-insurance to part-timers “only until December 31, 2013.”
The reason: Universal currently offers part-time workers a limited insurance plan that has low premiums but also caps the payout of benefits. For instance, Universal’s plan costs about $18 a week for employee-only coverage but covers only a maximum of $5,000 a year toward hospital stays. There are similar caps for other services.
Those types of insurance plans — sometimes referred to as “mini-med” plans — will no longer be permitted under the federal Affordable Care Act. Beginning in 2014, the law will prohibit insurance plans that impose annual monetary limits on essential medical care such, as hospitalization, or on overall spending.
The theory behind Obamacare comes down to this: Liberals believe it is better for you to pay a fine — er, tax — for not having the wonderful health insurance you can’t afford than to continue having the less-wonderful but affordable insurance you already have.
And if you don’t work at the Universal Studios theme park and still buy the line that “if you like your plan, you can keep it,” you might want to read what Colleen Medill, who teaches employee benefits law at the University of Nebraska, told Glenn Reynolds for his Instapundit blog:
I am deeply into studying the impact of Obamacare on employers, and I have been communicating with highly sophisticated ERISA lawyers who are advising employers, from Fortune 50 companies to small firms under 50 employees, on whether to keep or drop or modify their employer group health plans.
It has become very clear to everyone involved who is analytical and not ideological that the rational strategy, for both large and small firms, is to cease providing health care insurance to employees.
No company wants to admit that they are considering eliminating health insurance as an option, or be the first one to drop their health insurance plan, but once a competitor does so, the preference cascade will begin. The clear sentiment is “We will not be the first one to drop our health insurance plan, but we would be a close second.”
The coming preference cascade for employer group health plans is what the Democrats fear the most, because Obamacare was sold to the masses as “if you like your health insurance plan, you can keep it.”
The people who really know the law, and who have been following the avalanche of regulations, have already figured this out. It will take a while for this specialized knowledge to seep downward, because right now only $800+ an hour ERISA attorneys and the most sophisticated HR people understand how Obamacare really works.
Here’s a word to the wise: When a law benefits lawyers who charge $800-plus per hour and leads to fewer benefits for part-time employees, it is not going to be the boon to lower-income people that its advocates claimed it would be.
– By Kyle Wingfield
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361 comments Add your comment
JDW
February 20th, 2013
12:21 pm
@Kyle…”You liberals are always so condescending to the folks on whose side you claim to be.”
Having been the guy that decides on these programs across a base of 1000+ employees in both the US and Europe…I can tell you unequivocally that they “either no alternative or didn’t understand”
Del
February 20th, 2013
12:23 pm
Are you sick of losing to Canada?
getalife, are you referring to health care or economics? If the former most Canadians who’ve suffered or are suffering significant health issues will tell you how disappointed they are in the Canadian system. If you’re talking economics they’ve come a long way after deciding to scrap the liberal policies, which began during the Pierre Trudeau regime.
JDW
February 20th, 2013
12:23 pm
oops had no alternative
Kamchak ~ Thug from the Steppes
February 20th, 2013
12:25 pm
that is an annual cost of about $1.5 million for the affected workers leaving them “only” $948.5 million in operating cash flow….
Well, you know, $948.5 million doesn’t buy what it used to.
Gotta prioritize.
Triage.
Them execs. gotta have them mansions, otherwise they might “go Galt” on us.
Never mind that a sick populace eats into their revenue stream.
Kyle Wingfield
February 20th, 2013
12:27 pm
JDW: “Some employees” is a rather nebulous quantity.
Btw, Universal Studios as a whole in 2011 reported revenues of $4.239B but operating income of only $27M, a (pre-tax) margin of 0.6%.
getalife
February 20th, 2013
12:28 pm
del,
I am talking about dropping in ratings like the economy, infrastructure, education, etc… to attract corps to compete in the global market.
We are falling way behind and I am sick of it.
“Right-Wing Media Reported Chuck Hagel Was ‘Friends With Hamas’… Based On Reporter’s Joke” HP.
Your media working on their credibility.
Centrist
February 20th, 2013
12:31 pm
Kyle posted: “Universal Studios as a whole in 2011 reported revenues of $4.239B but operating income of only $27M, a (pre-tax) margin of 0.6%.”
Those greedy corporations (and stockholders) won’t give back all of their meager profits and take losses in order to give more to the employees. How dare them?!
Get Real
February 20th, 2013
12:32 pm
Reap the Whirlwind Liberal Idiots…
This is just the beginning and the Democrats own every single bit of this debacle
Cheesy Grits is gone but not forgotten
February 20th, 2013
12:32 pm
Del: I’m not going to respond directly to Jay’s column
Very wise
JDW
February 20th, 2013
12:32 pm
@Kyle…”operating income of only $27M, a (pre-tax) margin of 0.6%.”
I said cash flow not operating income…they, as do many large companies, do a wonder job of financial engineering to avoid paying taxes.
For the most part businesses are valued on free cash flow.
John
February 20th, 2013
12:35 pm
Has anyone considered, among all this mess, an actual reduction in Healthcare COSTS?!?! Like, for instance, Doctor + Hospital + Prescription Drugs Costs?? If Healthcare Insurance providers have to compete for customers via competitive rates, why not throw Doctors’ and Hospitals’ rates into the competition mix as well?
Del
February 20th, 2013
12:36 pm
Kyle, yes I read your commentary at the time and agree. The federal government doesn’t provide the money, taxpayers provide the money and given how far we are in debt accumulation, how can we afford another entitlement. Aside from the financial implications it’s my understanding that under the ACA exchanges will still be formed and managed regardless of respective state governments opting in or out. Since the exchanges will be formed in all states regardless I don’t see how Deal could be denying 600,000 health insurance.
indigo
February 20th, 2013
12:37 pm
Employers have been looking, for many years now, for a way to wiggle out of offering health insurance to their employees.
Now, with Obamacare, they can juggle the stats and make it appear they just won’t be able to afford this anymore.
And, loyal Republicans, naturally, will believe anything Big Business tells them.
Cheesy Grits is gone but not forgotten
February 20th, 2013
12:37 pm
If the former most Canadians who’ve suffered or are suffering significant health issues will tell you how disappointed they are in the Canadian system
Link please.
From what ive heard they like Universal Healthcare
A Strategic Counsel survey found 91% of Canadians prefer their healthcare system instead of a U.S. style system.[9][10] Plus 70% of Canadians rated their system as working either “well” or “very well”
http://en.wikipedia.org/wiki/Health_care_in_Canada
They are kicking our tail in almost every measurable way on healthcare.
But by all means proceed.
getalife
February 20th, 2013
12:42 pm
“They are kicking our tail in almost every measurable way on healthcare.”
Not just healthcare, their economy is better along with other issues.
They are even dictating a pipeline that runs through our country.
Del
February 20th, 2013
12:44 pm
Cheesy, wikipedia? yeah sure. There’s been documented accounts of Canadians coming here for health care they can’t receive in a timely manner in Canada. Also my late mother was Canadian and I know a few people there. We have the finest health care in the world at least for now.
Cheesy Grits is gone but not forgotten
February 20th, 2013
12:45 pm
Cheesy, wikipedia? yeah sure.
Shoot the messenger.
We have the finest health care in the world at least for now.
Not even close.
John
February 20th, 2013
12:46 pm
Yes indigo … companies typically have that unlimited “pot of gold” hiding in the back room, that only the evil Republican leaders of the company can access. You are blinded by foolish liberal kool-aid and a complete mis-understanding of how and why businesses exist. To make a profit perhaps?
md
February 20th, 2013
12:46 pm
“Remember, what we liberals truly want is medicare for all.”
And do you ever stop to think why that can’t work?
I’ll give you a few minutes to turn your brain on and work through the scenario……
indigo
February 20th, 2013
12:48 pm
For all you con tools who think global warming is a liberal myth.
http://www.cnn.com/2013/02/20/opinion/sutter-polar-bears/index.html?hpt=hp_c3
Kamchak ~ Thug from the Steppes
February 20th, 2013
12:49 pm
You are blinded by foolish liberal kool-aid and a complete mis-understanding of how and why businesses exist. To make a profit perhaps?
There’s your sign.
Cheesy Grits is gone but not forgotten
February 20th, 2013
12:49 pm
And Del.
More Americans go to Canada for healthcare than the other way around.
In fact marriages of convenience happen all the time along the border just so one of the two parties doesn’t have to go bankrupt to save their life.
All the countries with Universal Healthcare all have longer life spans. lower rates of heart disease, diabetes, infant mortality rates are lower, the list goes on and on.
Why is that you think ?
Del
February 20th, 2013
12:49 pm
Not even close.
Have you personally experienced health care treatments both here and in Canada or are you relying on far-left opinions and or wikipedia for your above opinion?
indigo
February 20th, 2013
12:50 pm
John – 12:46 “to make a profit, perhaps”
No John.
To make the LARGEST POSSIBLE profit is the goal.
Cheesy Grits is gone but not forgotten
February 20th, 2013
12:50 pm
Yes indigo … companies typically have that unlimited “pot of gold” hiding in the back room, that only the evil Republican leaders of the company can access. You are blinded by foolish liberal kool-aid and a complete mis-understanding of how and why businesses exist. To make a profit perhaps?
Strawman
md
February 20th, 2013
12:50 pm
“For the most part businesses are valued on free cash flow.”
No they aren’t……they are valued based on their overall financials.
One could have a billion dollars in cash flow but if they had 30 billion in debt and revenue of several million very few would want to touch them…….
USC-69
February 20th, 2013
12:53 pm
Some of these part time employees are probably earning minimum wage and are likely to be eligible for the Medicaid Expansion which, with the improved physician reimbursements, will be superior to many low-cost private insurance plans. Also, you did not address the real problem (Executive Compensation). My guess, that the NBC/Universal corporation pays many of its executives more than $150,000 per year (should we guess millions?). If I was one of these employees, I would want to know where the hard-earned money is and how it is distributed. I would probably make some effort to improve the fairness of the distribution. I think the Wal-Mart employees and others have been partially successful in causing public embarrassment for the most greedy and non-industrious corporate cogs sitting in corner offices with their feet up.
Politico
February 20th, 2013
12:55 pm
Obamacare is just the excuse for a business decision that was made. While maybe not agreeing with the decision, I understand that a financial decision was made. However, insurance didn’t just start going up. It has been doing so for years.
But with the heated debated over Obamacare, why not use that excuse knowing that people like Kyle will carry the “water” (message)
Centrist
February 20th, 2013
12:55 pm
@ Indigo – As if the earth has never warmed and cooled in cycles before and during mankind.
Citing a liberal media outlet about highlighting changes to polar bear habitats just like every other species (most went extinct even before man) as evidence of AGW is junk science. Junk science is now an art form for wealth transfer lead by the U.N. and other leftist bodies.
getalife
February 20th, 2013
12:57 pm
del,
I have done some consulting in Canada and the workers like their health care and government.
They are healthy and happy.
Aesop's Fables and other Lib Economic Theories
February 20th, 2013
12:57 pm
Just another example of liberal over reach, telling other people what’s good for them and then destroying everything in their mindless attempts to prove themselves right.
Couldn’t they just get a hobby instead?
Aesop's Fables and other Lib Economic Theories
February 20th, 2013
1:00 pm
If we wanted Canada’s health care, we would move there.
getalife
February 20th, 2013
1:00 pm
Aesop,
How is the weather today in la la land?
JDW
February 20th, 2013
1:01 pm
@md…”No they aren’t”
You are squarely in my area of expertise and you are mistaken. Free cash flow is the basic measuring block of any business. Next comes return on invested capital though acceptable rates vary based on industry. As for your example…not feasible… you can’t have free cash flow of a billion on revenue of several million unless you are cooking the books. As for debt the question is does the cash flow support the debt. While more debt does raise risks if it worried anyone Romney and the rest of the PE market, would have never made a dime.
getalife
February 20th, 2013
1:02 pm
CanadaCare is coming and it is just a matter of time.
Tick tock………………
Aesop's Fables and other Lib Economic Theories
February 20th, 2013
1:03 pm
There is a reason that Canada can afford to steal from it’s citizens and lavish them with long waiting times and selective care services. It’s called the United States, keeping them free from foreign invaders.
What do they got for self defense now, a couple of sling shots?
Aesop's Fables and other Lib Economic Theories
February 20th, 2013
1:04 pm
Check who’s in charge of the House, tick tock.
DOA.
Finn McCool (The System isn't Broken; It's Fixed)
February 20th, 2013
1:05 pm
Hey, Libs, just remember what kind of intelligent minds we are dealing wit here:
“There is nothing that gets into states right issues like riding a manatee,” says Michael Kauffman, author and Tea Party expert. “Today, we can’t ride a manatee–tomorrow, we won’t be able to open a business,” he told “The Daily Show’s” Al Madrigal
Aesop's Fables and other Lib Economic Theories
February 20th, 2013
1:05 pm
How about the Senate filibustering any and all nominees to the Death Panels? You hear any uproar from the American people over that?
chirp, chirp, chirp
John
February 20th, 2013
1:06 pm
… to make a profit, balanced with a healthy company financial report … for the investors, for the stockholders (if applicable), for the stakeholders (including employees if applicable), and for the sustainable existence and growth of the company (no matter what the size or the industry). So if a company chooses to drop employee healthcare coverage, have you considered that it might just be for the preservation of jobs within the company … and the company itself?
Finn McCool (The System isn't Broken; It's Fixed)
February 20th, 2013
1:06 pm
What do they got for self defense now…
bears?
SeeLow
February 20th, 2013
1:07 pm
The dim party is so accustomed to having their supporters believe whatever they are selling that they forget some people can think outside the box they want to put us in.
Desperation produces low-info voters.
Aesop's Fables and other Lib Economic Theories
February 20th, 2013
1:07 pm
I thought global warming killed the bears, oh, excuse me, that was last months lie.
Never mind.
Aesop's Fables and other Lib Economic Theories
February 20th, 2013
1:09 pm
How’s that gap between the rich and poor doing with the robin hood dummycrats in charge? Weren’t they just the other day cheering on Wall Street?
Darwin
February 20th, 2013
1:09 pm
And Republicans feel that emergency rooms are the best health care system in the world. So we’re even.
md
February 20th, 2013
1:09 pm
“You are squarely in my area of expertise and you are mistaken.”
And I’ve played some in that arena and you are wrong……
Cash flow is but one variable of the equation when valuing a company, if you base your decisions based on just one variable then good luck with that…….
” As for your example…not feasible…you can’t have free cash flow of a billion on revenue of several million unless you are cooking the books.”
You might want to change arenas if that’s what you think…….it’s pretty easy in my scenario and would be one of the reasons the company is in so much debt. If they borrowed 30 billion at some point it isn’t too hard to keep a billion of it in cash………
Geez, the housing bubble had plenty of players doing just that……as HD said last night, they walked away from the debt with cash in their pockets…..how do suppose they did that?
How do you suppose the Solyndra big wigs walked with our money in their pockets? We gave them the loans, they took their cut and then shut the place down……..
md
February 20th, 2013
1:10 pm
Finn…..you figured out why Medicare for all won’t work yet?
Finn McCool (The System isn't Broken; It's Fixed)
February 20th, 2013
1:13 pm
When asked who the “greatest Canadian” of all time was, Google whose name Canadians gave the most: Tommy Douglas, founder of their healthcare system.
from Wiki:
In 2004, a CBC Television program named him “The Greatest Canadian,” based on a viewer-supported survey.
further:
His government was the first democratic socialist government in North America, and it introduced the continent’s first single payer, universal health care program.
Uncle Jed
February 20th, 2013
1:13 pm
When the federal government fully takes over the medical care delivery system (think Post Office) not only will the level of care degenerate (bye-bye Saturday mail delivery) but a vast amount of the premiums we will all pay will simply be wasted and diverted. Sure, currently the premium derived profits may go to “corporate fat cats” and those evil entities, but at least the money remains available for the overall economy, which will not be the case once the bureaucrats are in charge.
The net effect will be poorer care at a higher cost resulting in ever increasing taxes ON ALL.
Aesop's Fables and other Lib Economic Theories
February 20th, 2013
1:19 pm
My health-care prejudices crumbled not in the classroom but on the way to one. On a subzero Winnipeg morning in 1997, I cut across the hospital emergency room to shave a few minutes off my frigid commute. Swinging open the door, I stepped into a nightmare: the ER overflowed with elderly people on stretchers, waiting for admission. Some, it turned out, had waited five days. The air stank with sweat and urine. Right then, I began to reconsider everything that I thought I knew about Canadian health care. I soon discovered that the problems went well beyond overcrowded ERs. Patients had to wait for practically any diagnostic test or procedure, such as the man with persistent pain from a hernia operation whom we referred to a pain clinic—with a three-year wait list; or the woman needing a sleep study to diagnose what seemed like sleep apnea, who faced a two-year delay; or the woman with breast cancer who needed to wait four months for radiation therapy, when the standard of care was four weeks.
Of course, his health care “prejudices” were based on a bunch of libs bad mouthing the US system.
Maybe these lovers of Canadacare just don’t know any better or are terminally stupid like all these US dummycrats.