She Sounds Vaguely Dissatisfied

I normally ignore the writings of Ms. Coulter, but the title of this piece (which the Jackson Clarion Ledger softened to "Thanks for nothing, Mickey Kaus") got my attention.

If the predictions of leading Obamacare adviser Ezekiel Emanuel's prediction that employer-based health care will be nearly destroyed by the ACA. Ezekiel, which is a very fitting name for a prophet of doom, thinks that about two-thirds of those who currently have employer-backed health care will lose it.

Waivers can drag this out for a while, but eventually people are going to get punched in the mouth.


Texan99 said...

The sad thing is that health insurance that's independent of one's employer is a great idea if it were done right instead of being foisted on people in the most disruptive and expensive way possible. It would have been terrific if we had concentrated on reducing the legislatively-induced disadvantages of individual coverage, so people would naturally have gravitated to it. For one thing, we could have equalized the tax treatment; employer-provided coverage is not taxable income, but I can deduct only 60% of my individual policy premiums.

With individual policies, you know exactly what they cost, so there's no hidden subsidy or COBRA shock if you lose your job and have to scramble to replace your coverage. For that matter, if you lose or change your job, it has no effect on your health coverage at all, so there's no anxiety about pre-existing conditions. HIPAA had already addressed many of the portability and cancellation problems, which could be alleviated even further by making insurance more portable across state lines.

Imagine if you lived in hurricane country and your windstorm protection was linked to your job? It's a crazy system.

As it is, though, we ain't seen nothin' yet.

Eric Blair said...

I'm waiting for some large company to do the math. If you look at your last W2, for those who get them, you'll see in box 12 some place the 'cost of health care' for what the business had to report as their cost of insurance (no matter what you yourself contributed). Given the typical insurance plans I'm familiar with, two adults will cost around 15k, and children will push it over 20k. Multiply that by the number of employees. I'll delibirately low ball the figure and pick 15k. Say the company employs 10000 people. That costs 150 million dollars a year. Now, if the company does not offer any insurance at all, they have to pay a 'fine' or tax or whatever of $2000 per employee per year. $2000 x 10000 = 20 million dollars a year. Savings of 130 million dollars. Per year. Savings of over a billion dollars in less than 10 years. Hell, the company could give every individual a $5000 raise per year, and they'd still be saving loads of money.

Grim said...

Still, if Ezekiel is right, 99.3 million people are about to have their health insurance -- "Cadillac plans" -- forcibly replaced.

War is coming. Not too soon. Not soon enough.

Texan99 said...

But all the employers would have to do that in concert, or else the ones who didn't give a $15,000 raise (or whatever was necessary to permit the employee to replace the lost insurance) would find it hard to retain workers.

The way it's supposed to work is that employers would get used to paying employees in cash, and let the employees use the cash to buy their own health insurance, the same way they buy their own car insurance and home insurance. By treating the value of health insurance as non-taxable, for decades we've been encouraging employers to provide health coverage rather than raises.

Texan99 said...

Oh, I'm with you there. There's a huge difference between ceasing to do dumb things that make individual insurance less attractive, so that people naturally decide they prefer it, and what these bozos are about to do, which is wreck on-the-job insurance that people like and suddenly replace it with junk that costs more. The voters probably will go wild--at least, I hope so. But voters keep disappointing me with their willingness to swallow nonsense, especially if they can be induced to blame it on rich corporations.

Still, the polls are somewhat encouraging.

Eric Blair said...

Sorry Tex, you don't need employers to do it in concert, you just need one to start the preference cascade.

They would not find it hard to retain employees because, well, its a job. For every employee that doesn't want that, there would be more than one willing to do that job.

Someobody just has to start the ball rolling.

Texan99 said...

I guess I can't see it that way. Employers would find themselves losing their best employees for the same reason as if they just started cutting salaries randomly, at a time when their competitors weren't doing the same. How could it be otherwise?

E Hines said...

Product pricing isn't anywhere near as sticky as labor pricing, especially in a job-poor "recovery" like this one.

The lower costs to the producer from such a move would increase those initial producers' market share, pressuring their competitors to cut costs--and the primary way is to use the same cost-cutting path.

This will have a more powerful effect in low-margin, high customer price sensitivity industries than in industries with different combinations of margin and stickiness, and the relative strengths of the cost cutting moves vs the realized (not speculated) employee...migration.

My money, though, is on the cost cutting.

Eric Hines

Nicholas Darkwater said...

Keep pumping this story. I am amazed at the people who are wringing their hands over the present situation and who have no earthly idea of the employer mandate catastrophe coming down the pike at them, which will start arriving after the next election, or, if the current track holds true, maybe until after the election in 2016, at which time the Democrats and the media (but I repeat myself) will blame the Republicans.