Even if US President Barack Obama aims to bring uniformity among the Americans, including the employees, in terms of making them medically insured, a new study on the ObamaCare employer mandate has made some startling revelations.
According to a new study that was released on Friday, Obamacare employer mandate will hit the low-wage workers the most. It is noteworthy, the employer mandate has been delayed twice so far.
The study was conducted by the Robert Wood Johnson Foundation(RWJF) and the Urban Institute. RWJF is a supporter of Obama’s healthcare law. The institute has donated USD 13 million to a White House-connected nonprofit promoting Obamacare enrollment, Enroll America.
They examined the effects of repealing the employer mandate or moving ahead.
The researchers found that the employer mandate will barely affect the uninsured rate.
The study researchers said, “Employers with 50 or more workers not offering coverage pre-ACA are the same employers that are highly likely to not offer in the future, therefore incurring the ACA’s penalties. Because the non-offering firms are much more likely to be firms dominated by low-wage workers, low-wage employees will bear the greatest brunt of the penalties imposed.”
The study researchers are of the opinion that hiring will likely be short by the arbitrary cut-offs in the mandate. However, the federal government expects to gain billions in penalty payments from those companies who go for disobeying the mandate in the end. According to the researchers, these costs may pass back to the workers, particularly low-wage employees , in the form of reduced wages.
Moreover, few workers may also lose health coverage in the absence of the employer’s mandate. In case they are entirely eliminated, employer coverage would fall by just 500,000, nongroup coverage would correspondingly rise by 300,000 and Medicaid would grow by 100,000 people.
The net rise in the uninsured would be just 200,000, a relative hike of just 0.6 percent.
What is Obamacare’s Employer Mandate?
Obamacare’s employer mandate is officially part of the Employer Shared Responsibility provision. Under the Affordable Care Act, the federal and state governments, insurers, employers and individuals have been given shared responsibility to bring reform and improve the availability, quality and affordability of health insurance coverage in America.
Key highlights of Obamacare’s Employer mandate
- It is based on full-time equivalent employees and not just full-time employees.
- The annual fee is USD 2,000 per employee.
- The first 30 full-time employees are exempted.
- The fee is based on whether or not you offer affordable health insurance to your employees that provides minimum value.
- If at least one full-time employee receives a premium tax credit because coverage is either unaffordable or does not cover 60 percent of total costs, the employer must pay the lesser of USD 3,000 for each of those employees receiving a credit or USD 750 for each of their full-time employees.
- The fee is a per month fee due annually on employer federal tax returns starting in 2015 for small businesses with 100 or more full-time equivalent employees(2016 for those with 50-99). So the per month fee is 1/12 of the 2,000 or USD 3,000 per employee.
- Unlike employer contributions to employee premiums, the Employer Shared Responsibility Payment is not tax deductible.
- The Internal Revenue Service has more information about the Employer Shared Responsibility Payment.