Company Dumps Healthcare Plan

[thereisnospoon]

The large employer gets assessed at $2000-$3000 per employee per year, (as tax penalty) and this $2000-$3000 per employee is not tax deductible, as paying for insurance would be, and the large employer's employees would not be eligible for any subsidies if he offers them the $350 towards health insurance on the exchange, AND the $350 that he would give employees to buy insurance is also not tax deductible because the law states you must be buying the health insurance for the employee, not for the employee to buy their own, so the IRS would not allow that $350 as a deduction...they could just give them all a $350 raise, then that could be deductible, i suppose....

Most large companies offer health care insurance because their employees demand it, and when they go and get rid of the benefit, it is the beginning of their best employees to a mass exodus, of them leaving and going to companies that do offer it....

Before the Obama care mandate, large corporations could have dropped their insurance any time they wanted, or never have offered it in the first place....there was nothing stopping them, no penalties or any of that...yet most of them offered health care insurance....for recruiting the best employees.

Good luck to your friend's company!

That's a lot of "if's".....Sums up to nothing.
it comes as no surprise an uninformed lib such as yourself has not the ability to figure this out.

 

[thereisnospoon]

Sure? of course not. But evidence suggests that it can and does work in other countries. But we have seen that a private based system doesn't work for everyone.

Government run healthcare "doesn't work for everyone".

Reality disagrees with you.

So sorry.

Your response is based on your opinion. Which is irrespective of the facts.
So why are you so emotionally invested in socialized medicine?
What's in it for you?

 

[NYcarbineer]

uh....and 1 million in fines.

Or did you miss that because you were so hell bent on criticizing someone for making some money?

That's another 167 per month. 350+167 equals $517.

Okay, so he's saving 150/month per employee by cutting their healthcare benefit.

The federal government ( taxpayers) pick up the difference.
And that is precisely the purpose of Obamacare. To create dependency on government.

The government picks up the difference when the minimum wage is kept low.

 

[jillian]

That's another 167 per month. 350+167 equals $517.

Okay, so he's saving 150/month per employee by cutting their healthcare benefit.

The federal government ( taxpayers) pick up the difference.
And that is precisely the purpose of Obamacare. To create dependency on government.

The government picks up the difference when the minimum wage is kept low.

i'm not quite sure why they won't acknowledge that.

the bizarre thing about his post is that it totally and completely ignores the fact that the point, at least as stated by the heritage foundation, was for people to "take responsibility" and insure their own health care by using the private market... which is what the ACA does.

keeping wages and benefits artificially low is what keeps people dependent on the government.

 

[The Rabbi]

The federal government ( taxpayers) pick up the difference.
And that is precisely the purpose of Obamacare. To create dependency on government.

The government picks up the difference when the minimum wage is kept low.

i'm not quite sure why they won't acknowledge that.

Because they have nothing to do with each other? Just a guess, "counselor" <snicker>

 

[thereisnospoon]

The large employer gets assessed at $2000-$3000 per employee per year, (as tax penalty) and this $2000-$3000 per employee is not tax deductible, as paying for insurance would be, and the large employer's employees would not be eligible for any subsidies if he offers them the $350 towards health insurance on the exchange, AND the $350 that he would give employees to buy insurance is also not tax deductible because the law states you must be buying the health insurance for the employee, not for the employee to buy their own, so the IRS would not allow that $350 as a deduction...they could just give them all a $350 raise, then that could be deductible, i suppose....

Most large companies offer health care insurance because their employees demand it, and when they go and get rid of the benefit, it is the beginning of their best employees to a mass exodus, of them leaving and going to companies that do offer it....

Before the Obama care mandate, large corporations could have dropped their insurance any time they wanted, or never have offered it in the first place....there was nothing stopping them, no penalties or any of that...yet most of them offered health care insurance....for recruiting the best employees.

Good luck to your friend's company!

If any of these employees at your friend's company have spouses whose employer has health insurance they would be forced to go on their spouse's plan before they could go on to the exchange with subsidies as well...

Did you just make that up?

 

[NYcarbineer]

If this employer could save so much money not giving his employees healthcare, why didn't he do it before now?

 

[thereisnospoon]

Sure? of course not. But evidence suggests that it can and does work in other countries. But we have seen that a private based system doesn't work for everyone.

Government run healthcare "doesn't work for everyone".

Yet conservatives can't find even ONE poll EVER from a UHC nation that wants US style H/C!

Polls?
Umm, sunshine......In case you have been living in a subway tunnel, know this....Once government rolls out an entitlement, it is virtaully impossible to get rid of it.
Western European nations, save a very few, have socialized medicine because they cannot end the programs.
These countries have run out of people and businesses to tax.
The basis of socialized medicine is not to control costs. It controls the consumer price but ignores the eventual rising costs.

 

[thereisnospoon]

Reality disagrees with you.

So sorry.

Actually, it doesn't work as WELL for everyone.

Yes, it works FOR everyone....but not necessarily as well as private healthcare for those that can afford it.

No arguments there. Our system is THE BEST in the world....if you can afford it. Which way too many can't. So our system is a system for the few, not for the whole. Which is why I supported a public option initially. Let everyone have something, and those who want and can afford it can purchase premium coverage. Many countries have a system like this that works for them.

Medical care in the US is expensive because of government interference.

 

[thereisnospoon]

so his plan to save money is to push this onto the tax payer......i assume he doesnt like obama and most government agencies in general.

He does realize that the more people who sign on to ACA the more it works right?

yeah naturally your friends would be as stupid as you

Who is saving money?
ACA is a failure on that point.
Some may see reduced premiums, but they have much larger deductibles.

 

[Old Rocks]

After seeing how well our government handled the VA...

You sure it is such a great idea?

Sure? of course not. But evidence suggests that it can and does work in other countries. But we have seen that a private based system doesn't work for everyone.

No precisely the opposite. 4 countries in the EU were essentially bankrupted by socialized medicine and other entitlements.
The EU is forever indebted to Germany because but for that nation's prosperity( read they make stuff and have a robust economy) the EU would have collapsed under the weight of government giveaways with no possible resources to pay for them.

And Germany is the nation that started the whole socialized medicine gambit. And has the most generous policies for it's workers.

Development of the Health Care System in Germany

Nearly everyone residing in Germany is guaranteed access to high-quality comprehensive health care. Statutory health insurance (Gesetzliche Krankenversicherung--GKV) has provided an organizational framework for the delivery of public health care and has shaped the roles of payers, insurance or sickness funds, and providers, physicians, and hospitals since the Health Insurance Act was adopted in 1883. In 1885 the GKV provided medical protection for 26 percent of the lower-paid segments of the labor force, or 10 percent of the population. As with social insurance, health insurance coverage was gradually extended by including ever more occupational groups in the plan and by steadily raising the income ceiling. Those earning less than the ceiling were required to participate in the insurance program. In 1995 the income ceiling was an annual income of about DM70,00 in the old Länder and DM57,600 in the new Länder.



In 1901 transport and office workers came to be covered by public health insurance, followed in 1911 by agricultural and forestry workers and domestic servants, and in 1914 by civil servants. Coverage was extended to the unemployed in 1918, to seamen in 1927, and to all dependents in 1930. In 1941 legislation was passed that allowed workers whose incomes had risen above the income ceiling for compulsory membership to continue their insurance on a voluntary basis. The same year, coverage was extended to all retired Germans. Salespeople came under the plan in 1966, self-employed agricultural workers in 1972, and students and the disabled in 1975.

The 1883 health insurance law did not address the relationship between sickness funds and doctors. The funds had full authority to determine which doctors became participating doctors and to set the rules and conditions under which they did so. These rules and conditions were laid down in individual contracts. Doctors, who had grown increasingly dissatisfied with these contracts and their limited access to the practice of medicine with the sickness funds, mobilized and founded a professional association (Hartmannbund) in 1900 and even went on strike several times. In 1913 doctors and sickness funds established a system of collective bargaining to determine the distribution of licenses and doctors' remuneration. This approach is still practiced, although the system has undergone many modifications since 1913.

 

[NYcarbineer]

The company & their employees were paying $5.5 million. That was $916.66 a month per employee. That is way higher than other companies charge, including those on Obamacare exchanges. Looks like that greedy insurance company loses $5.5 million in revenue & Obamacare, the company & it's employees win.

You're ignoring the cost of the government subsidies, moron.

The million dollar penalty goes towards the subsidies.

 

[thereisnospoon]

What I see happening is health insurance that doesn't work for those covered. In order to be "affordable" the deductables are so high as to have one of two results. First is a reluctance to use it because of high deductables. Basically meaning only the poor can afford good coverage, because they don't pay anything. Result two is an even higher cost to health care as folks pay high premiums and the high deductables to have care.

Here is one of the foibles of ACA.....And this comes straight from my Chiropractor's financial admin....She told me that die to ACA rules, if a new patient so much as mentions they are covered by a health insurance policy, by law, the office MUST bill that company for the patient's treatment.
Now, here's the real pisser. Because my insurance did not cover for Chiropractic as "well care" I became a cash customer.
I pay $45 for an adjustment plus a nice traction stretch or stim pad session....
And insured patient 'pays' $155 for the same thing. Of course the reimbursement is much lower.
It is cheaper to be a cash patient. But Obamacare does not want people paying for medical care. And the geniuses in DC made sure of that. Pricks.
How dare a bunch of politicians tell the American people they may not pay for their own health care?!!!!

 

[Missouri_Mike]

Sure? of course not. But evidence suggests that it can and does work in other countries. But we have seen that a private based system doesn't work for everyone.

No precisely the opposite. 4 countries in the EU were essentially bankrupted by socialized medicine and other entitlements.
The EU is forever indebted to Germany because but for that nation's prosperity( read they make stuff and have a robust economy) the EU would have collapsed under the weight of government giveaways with no possible resources to pay for them.

And Germany is the nation that started the whole socialized medicine gambit. And has the most generous policies for it's workers.

Development of the Health Care System in Germany

Nearly everyone residing in Germany is guaranteed access to high-quality comprehensive health care. Statutory health insurance (Gesetzliche Krankenversicherung--GKV) has provided an organizational framework for the delivery of public health care and has shaped the roles of payers, insurance or sickness funds, and providers, physicians, and hospitals since the Health Insurance Act was adopted in 1883. In 1885 the GKV provided medical protection for 26 percent of the lower-paid segments of the labor force, or 10 percent of the population. As with social insurance, health insurance coverage was gradually extended by including ever more occupational groups in the plan and by steadily raising the income ceiling. Those earning less than the ceiling were required to participate in the insurance program. In 1995 the income ceiling was an annual income of about DM70,00 in the old Länder and DM57,600 in the new Länder.



In 1901 transport and office workers came to be covered by public health insurance, followed in 1911 by agricultural and forestry workers and domestic servants, and in 1914 by civil servants. Coverage was extended to the unemployed in 1918, to seamen in 1927, and to all dependents in 1930. In 1941 legislation was passed that allowed workers whose incomes had risen above the income ceiling for compulsory membership to continue their insurance on a voluntary basis. The same year, coverage was extended to all retired Germans. Salespeople came under the plan in 1966, self-employed agricultural workers in 1972, and students and the disabled in 1975.

The 1883 health insurance law did not address the relationship between sickness funds and doctors. The funds had full authority to determine which doctors became participating doctors and to set the rules and conditions under which they did so. These rules and conditions were laid down in individual contracts. Doctors, who had grown increasingly dissatisfied with these contracts and their limited access to the practice of medicine with the sickness funds, mobilized and founded a professional association (Hartmannbund) in 1900 and even went on strike several times. In 1913 doctors and sickness funds established a system of collective bargaining to determine the distribution of licenses and doctors' remuneration. This approach is still practiced, although the system has undergone many modifications since 1913.

I'm guessing you will need a little time to research those dates and actions and correlate them with history and what it actually meant as well as the reason's behind those actions.

 

[thereisnospoon]

awwwww.... $350 to every employee for insurance that costs thousands.

how nice.

thanks for the "story". but good that you want to encourage companies to force us to pay for you freeloaders.... while crying and whining about efforts to get people covered by insurance in a manner they can afford.

typical rightwingnut idiocy.

If idiots like you hadnt supported Obamacare the company would never have had this incentive to dump employees. Who do you think is going to cover the difference between the350 the company gives and the premium cost? Yeah, you. You voted for it, you get to pay for it. Pretty simple.

But...wait...wasn't obumercare only supposed to cost each family $2500/yearly?

Nope. According to the Chosen One, we were all supposed to SAVE $2500 per year...

 

[Care4all]

A friend of mine is the benefits manager for a small company (500 employees). He tells me as of 12/31 they will no longer offer health insurance. Why?
Well, currently they spend $4M/yr on health coverage for their employees. The employees kick in another 1.5M. By dropping coverage he pays the $1M penalty. But in return he can give each employee $350/mo towards their own coverage and still come out ahead. Some employees can get more even more if the company wants to keep them. The lower paid employees can qualify for gov't subsidies, which they couldnt before because the company offered a health plan. ANd between subsidies and employer contribution they can pick exactly the coverage they want, so better for them.
All in all it's a win win for employer and employee. But since this is a zero sum game the loser is of coure the taxpayer, who will be subsidizing all the lower paid employees who dont have coverage from their jobs.
This will of course drive up the cost of Obamacare astronomically.

Every company similiarly situated is doing exactly the same analysis and they will come to exactly the same concliusions: cheaper to kick employees off the plan and just pay them a little extra.

Figuring the $4 million spent on healthcare, is actually about $2.6 million net for the company, because tax code gave them a 35% tax break on the $4 million deduction.

-----------------------------------------
to pay each employee $350 a month X 12 Months X 500 employees is $2.1 million, but this would give you a business deduction so you would save 35% in taxes on that as well....so that could net out to $1,365,000....

plus another +/-10% for SS taxes and Medicare taxes on the $2.1 million gross salaries, (plus higher rate in UE fees for avg employee pay being higher...)so, add $210,000 to the $1,365,000, so we are at $1,575,000 for the employer....

PLUS the $1,000,000 in yearly tax assessment penalties, which is NOT tax deductible as a business expense.

soooo thats about $2.575 million a year....

THERE IS NO SAVINGS
to this company in your example

It is about the same amount of money for the owner to try to skirt the situation of paying for employee's health care insurance, WITHOUT giving the employee the benefit of having insurance, without the company's ability to recruit better employees by having the health insurance benefit...

It's a LOSE, LOSE for the employee and the employer...there is no way around that....

and sure, for those of the 500 that are getting paid piss poorly, the exchange could help them, but for most of the employees, in a company that is large enough to have 500 employees, are probably getting paid well enough to not get that much of a subsidy if any at all, and also more than likely, many employees could have a spouse that works and they would have to go on their spouse's plan, and not the exchange with subsidy help...and the spouse's employer is ONLY responsible for making the employee portion affordable, not a family plan...so their employees majorly get dicked with just the $350 gross, that is really $250 net....

And I would have to ask, why would any ETHICAL company, put their employee's health care expense on to the tax payers if it does not save them a dime to do such...if they are going to have to pay the $2.6 million net regardless with a plan like the one you mentioned above?

Makes no sense....

other than intentionally trying to bankrupt us as a Nation....and that is not a laughing matter....

Btw, the penalty for Romneycare was even less for employers in Massachusetts, so there was more incentive for the businesses to just drop it and let their employees get subsidized by the State, but guess what?

They didn't drop employee insurance, coverage actually increased for the number of employers carrying coverage for their employees....

so if a +/-$250 an employee penalty didn't make these businesses jump ship and save the money on health insurance benefits, then why would you think they would jump ship with a $2000 a head penalty?

 

[Missouri_Mike]

What I see happening is health insurance that doesn't work for those covered. In order to be "affordable" the deductables are so high as to have one of two results. First is a reluctance to use it because of high deductables. Basically meaning only the poor can afford good coverage, because they don't pay anything. Result two is an even higher cost to health care as folks pay high premiums and the high deductables to have care.

Here is one of the foibles of ACA.....And this comes straight from my Chiropractor's financial admin....She told me that die to ACA rules, if a new patient so much as mentions they are covered by a health insurance policy, by law, the office MUST bill that company for the patient's treatment.
Now, here's the real pisser. Because my insurance did not cover for Chiropractic as "well care" I became a cash customer.
I pay $45 for an adjustment plus a nice traction stretch or stim pad session....
And insured patient 'pays' $155 for the same thing. Of course the reimbursement is much lower.
It is cheaper to be a cash patient. But Obamacare does not want people paying for medical care. And the geniuses in DC made sure of that. Pricks.
How dare a bunch of politicians tell the American people they may not pay for their own health care?!!!!

Same here. My bone cracker charges me 40 per visit. Our insurance no longer covers chiropractic thanks to obiecare. But it does give us all the prenatal care and birth control a woman of 43 with a hysterectomy could ever need.

 

[saveliberty]

The company & their employees were paying $5.5 million. That was $916.66 a month per employee. That is way higher than other companies charge, including those on Obamacare exchanges. Looks like that greedy insurance company loses $5.5 million in revenue & Obamacare, the company & it's employees win.

You're ignoring the cost of the government subsidies, moron.

The million dollar penalty goes towards the subsidies.

So you should want a large number of companies to opt out. Of course that flies in the face of covering more people and making it affordable... Circular reasoning belongs in circular files.

 

[thereisnospoon]

That's another 167 per month. 350+167 equals $517.

Okay, so he's saving 150/month per employee by cutting their healthcare benefit.

The federal government ( taxpayers) pick up the difference.
And that is precisely the purpose of Obamacare. To create dependency on government.

The government picks up the difference when the minimum wage is kept low.

Non sequitur.
If you want to discuss the min wage, feel free to start a thread on that issue.
Next.

 

[Missouri_Mike]

A friend of mine is the benefits manager for a small company (500 employees). He tells me as of 12/31 they will no longer offer health insurance. Why?
Well, currently they spend $4M/yr on health coverage for their employees. The employees kick in another 1.5M. By dropping coverage he pays the $1M penalty. But in return he can give each employee $350/mo towards their own coverage and still come out ahead. Some employees can get more even more if the company wants to keep them. The lower paid employees can qualify for gov't subsidies, which they couldnt before because the company offered a health plan. ANd between subsidies and employer contribution they can pick exactly the coverage they want, so better for them.
All in all it's a win win for employer and employee. But since this is a zero sum game the loser is of coure the taxpayer, who will be subsidizing all the lower paid employees who dont have coverage from their jobs.
This will of course drive up the cost of Obamacare astronomically.

Every company similiarly situated is doing exactly the same analysis and they will come to exactly the same concliusions: cheaper to kick employees off the plan and just pay them a little extra.

Figuring the $4 million spent on healthcare, is actually about $2.6 million net for the company, because tax code gave them a 35% tax break on the $4 million deduction.

-----------------------------------------
to pay each employee $350 a month X 12 Months X 500 employees is $2.1 million, but this would give you a business deduction so you would save 35% in taxes on that as well....so that could net out to $1,365,000....

plus another +/-10% for SS taxes and Medicare taxes on the $2.1 million gross salaries, plus higher rate in UE fees for avg employee pay being higher...so, add $210,000 to the $1,365,000, so we are at $1,575,000 for the employer....

PLUS the $1,000,000 in yearly tax assessment penalties, which is NOT tax deductible as a business expense.

soooo thats about $2.575 million a year....

THERE IS NO SAVINGS
to this company in your example

It is about the same amount of money for the owner to try to skirt the situation of paying for employee's health care insurance, WITHOUT giving the employee the benefit of having insurance, without the company's ability to recruit better employees by having the health insurance benefit...

It's a LOSE, LOSE for the employee and the employer...there is no way around that....

and sure, for those of the 500 that are getting paid piss poorly, the exchange could help them, but for most of the employees, in a company that is large enough to have 500 employees, are probably getting paid well enough to not get that much of a subsidy if any at all, and also more than likely, many employees could have a spouse that works and they would have to go on their spouse's plan, and not the exchange with subsidy help...and the spouse's employer is ONLY responsible for making the employee portion affordable, not a family plan...so their employees majorly get dicked with just the $350 gross, that is really $250 net....

And I would have to ask, why would any ETHICAL company, put their employee's health care expense on to the tax payers if it does not save them a dime to do such...if they are going to have to pay the $2.6 million net regardless with a plan like the one you mentioned above?

Makes no sense....

other than intentionally trying to bankrupt us as a Nation....and that is not a laughing matter....

Btw, the penalty for Romneycare was even less for employers in Massachusetts, so there is more incentive for the businesses to just drop it and let their employees get subsidized by the State, but guess what?

They didn't drop employee insurance, coverage actually increased for the number of employers carrying coverage for their employees....

so if a +/-$250 an employee penalty didn't make these businesses jump ship and save the money on health insurance benefits, then why would you think they would jump ship with a $2000 a head penalty?

Just reading your post you don't seem very good at math. Can you put this into a spreadsheet so we can all make sense of your post?