John on August 24, 2011 at 2:33 pm
The AP reports on two recent surveys of employers that shows nearly 10% are already planning to drop health coverage once Obamacare starts in earnest. Another 20% are unsure what they will do:
Employer-sponsored health insurance has long been the backbone of the nation’s health insurance system. But the studies suggest some employers, especially retailers or those paying low wages, feel they will be better off paying fines and taxes than continuing to provide benefits that eat up a growing portion of their budget every year.
The exchanges, devised under health care overhaul, may offer an alternative for workers. These exchanges aim to provide a marketplace for people to buy insurance that can be subsidized by the government based on income levels.
As I pointed out earlier this month, Obama’s HHS has given waivers to companies specifically to prevent them dropping coverage before the exchanges are up and running. However, once the waivers end in 2014, they no doubt expect the dumping to begin.
Still, one has to admire the rapidity of CBO’s failure on this. It was only a year ago that they were estimating a mere 2.5% of employers would drop coverage by 2019. Now we’re talking about 10% by 2014 with another 20% claiming to be uncertain.
But fear not, this will be the least of CBO’s underestimates with regard to Obamacare. The cost is where things will get really surprising.
[HT: Fox Nation]