And another thing ... Employer health care future; progressive passion

And another thing ... Employer health care future; progressive passion

May 2nd, 2014 in Opinion Free Press

Like Your Health Insurance?

A new report by S&P Capital IQ, a research firm serving the financial industry, indicates that by 2020 about 90 percent of American workers who now receive employer health insurance will be shifted to government exchanges created by the Affordable Care Act (ACA).

How many who didn't think the ACA was a good idea in the first place knew this was coming? Good. Go to the head of the class.

Despite President Barack's Obama repeated statements about keeping your health insurance, your personal health insurance not increasing in price and the ACA not being a stalking horse for full government-run health insurance, a single-payer system always was the administration's goal.

The scope and speed of the shift to government insurance exchanges and the amount of money the companies could save, though, are surprising, according to a report by New York Times senior economic correspondent Neil Irwin.

S&P researchers concluded the shift could save the biggest American companies as much as $700 billion between 2016 and 2025, or about 4 percent of their total value. For all companies with more than 50 employees, the total would soar to $3.25 trillion.

On the surface, why wouldn't companies do it?

Since federal and state exchanges exist so that anyone, even those with pre-existing illnesses, can gain coverage, employers could just give workers a stipend to pay for health insurance with the exchanges rather than offer a plan themselves.

The idea parallels that of the defined-benefit pension plans in most companies being rolled into the likes of 401(k)s over the last 20-plus years, according to Michael G. Thompson, managing director at S&P. They cost companies less and are easier to administer.

"We still expect some companies to hold on to their health care plans, just as some private companies still have pensions," Thompson said in the New York Times report. "But we think that the tax incentives for employer-driven insurance are not enough to offset the incentives for companies to transition people over to exchanges and have them be more autonomous around management of their own health care."

In a perfect world, Irwin argues, an efficient ACA would provide better care at lower costs, but he says it's anyone's guess what the system -- which already endured a stunningly bad rollout -- will look like in, say, 2025. And whether costs not borne by employers would redound to the federal government, through insurance subsidies, or individuals paying more can't be known.

Still, he says such a shift is not a certainty because employees still put a value on health insurance plans, employers who don't offer them may lose a competitive advantage, employers who subsidize insurance plans directly receive a tax benefit from it (but lose it if they give workers extra pay to help them buy health insurance on an exchange), and because large employers who don't provide insurance must fork over an ACA-mandated, $2,000-per-worker annual penalty.

So, while the timing may be a bit hazy, the shift to what the Obama administration wanted is underway. Whether, or in what way, it can be stopped is up in the air.

Bring On The Progressives

A new Chattanooga area progressive -- meaning liberal -- political action committee will hold a kickoff meeting on May 7, and as bad as liberal government has been for the country over the last five years, the group could have a positive effect on politics in the area.

In next week's Hamilton County primary election, 17 offices up for grabs have either Republicans running unopposed or only Republicans opposing each other. Certainly, many of those Republicans deserve re-election or election, but principled opposition is never a bad thing. (Please see a review of our endorsements for contested primary races in Sunday's Perspective section.)

It sharpens the work of incumbents of both major parties if they are aware they will have serious opposition in elections, it forces candidates to refine their positions on the campaign trail rather than offer platitudes and promises, and it causes voters to think more carefully about their choices rather than simply darkening the oval by the "R" or the "D."

This new group, which plans to register as the New Guard PAC with the Tennessee Bureau of Ethics and Campaign Finance, is to date composed primarily of young City Hall staffers, former Ochs Center employees and ex-campaign workers.

Members say they want to draw the kind of attention, enthusiasm and turnout to local elections as there are for national elections. That would be a good thing.

While New Guard PAC doesn't plan to field any candidates in this year's election cycle, it does plan to make endorsements in August's Hamilton County School Board races.

With progressives responsible nationally for many things in schools parents profess not to like -- stifling of religious references, lack of choice and union support of poor teachers, for instance -- whether some candidates will want such an endorsement remains to be seen.