Wednesday, July 3, 2013

Talking out my ass

...about the Obama administration's decision to delay implementation of the employer mandate.

The principal argument, as articulated by Jared and Ezra, is that the provision as written in law is poorly formulated and onerous. I'm all for the government recognizing when provisions of law and regulation are poorly formulated and onerous, but this bears a bit more scrutiny.

To wit: the mandate requires all employers with more than 50 full-time employees to provide adequate health coverage or be fined. The number getting cited in the links above is that "95%" of these employers already provide insurance, though it remains unclear whether those plans need any tweaking (or major revisions) to comply with the law. I don't see anything onerous yet, however.

What appears to be the actual crux of the issue, instead, is the "full-time" part of the provision, which (it is claimed) will result (is already resulting?) in employers near the 50-employee cutoff restructuring their labor arrangements so that they will fall on the lower end of the bright line. For example, supposedly employers can pull a Wal-Mart and ride their workers up to 35.999 hours a week (numbers also sourced from ass), provide no benefits, and not fall afoul of the law. That would be a genuine problem, especially considering the already short supply of work for the average hourly worker. However, I don't see how delaying implementation of the law makes any sense as a solution; instead, a regulatory interpretation should have been issued (and given public comment period a year ago) that the DOJ would be interpreting the requirement as 50 full-time-equivalent employees (50*40*52 wage-hours in a year) rather than 50 individuals working more than 36 hours a week or whatever the numbers might actually be.

Seriously, people: don't reward obvious loophole-ducking. Close the damn loophole with an administrative rule.

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