The case for scrapping ObamaCare’s employer mandate

Experts from both sides of the aisle are now calling on the Obama administration to eliminate the employer mandate from the president’s signature health-insurance law. A briefing paper released by the Robert Wood Johnson Foundation, a liberal-leaning foundation that previously supported former president Bill Clinton’s health-care plan and is now a major supporter of ObamaCare,...

Experts from both sides of the aisle are now calling on the Obama administration to eliminate the employer mandate from the president’s signature health-insurance law.

A briefing paper released by the Robert Wood Johnson Foundation, a liberal-leaning foundation that previously supported former president Bill Clinton’s health-care plan and is now a major supporter of ObamaCare, makes the case for scrapping the employer mandate.

The employer mandate provision of the Affordable Care Act, or ACA, commonly referred to as ObamaCare, was supposed to go into effect Jan. 1, 2014, but was delayed this past summer for one year by the Obama administration and was recently delayed again for another year for those employers with 50-99 full-time or full-time equivalent employees. Under ObamaCare, employers with 50 or more full-time employees or full-time equivalents are required to offer “qualified and affordable” health insurance coverage to their employees.

According to the Robert Wood Johnson Foundation report’s authors:

“Our analyses as well as that of others find that eliminating the employer mandate will not reduce insurance coverage significantly, contrary to its supporters’ expectations. Eliminating it will remove labor market distortions that have troubled employer groups and which would harm some workers.”

While a welcome call to action, these facts are widely acknowledged by both supporters and opponents of the president’s signature legislation. In fact, previous research by the Illinois Policy Institute has shown that it is the workers in the nation’s lowest-paid sectors who may already be experiencing the greatest harm through involuntary cuts to their work hours as a result of ObamaCare.

The Institute’s report analyzed federal and state labor data, and found that workers in the retail sector in 12 of the 14 states where these data were available faced average annual declines in hours between 2011 and 2013. Six of those states saw average hours worked fall to 30 hours or below – the new government definition of full-time employment under the law. One state had no change in hours and one saw an increase. This trend was particularly dramatic as it was not observed in the aftermath of the financial crisis.

In Illinois, workers in the food service, general merchandise and retail sectors have seen a drop in the average number of hours worked to below 30 hours per week. The drop in average hours worked in these three low-wage sectors is the equivalent of 63,000 lost jobs in the president’s home state since 2011.

The Robert Wood Johnson Foundation report provides further acknowledgement that the nation’s lowest-wage workers are being directly harmed by the ObamaCare employer mandate. Scrapping the employer mandate would not only be welcome news for Illinois, but it would also benefit the nation’s hourly, lowest-wage workers who are facing jobs and hours cut. Given these harmful effects – widely acknowledged on both sides of the aisle – there is little reason that this provision shouldn’t be scrapped altogether.