Obamacare’s employer mandate—which will require businesses with 50 or more full-time equivalent workers to provide health insurance or pay a fine—has been delayed until 2016 for many small companies. However one new report suggests that repealing the mandate altogether wouldn’t significantly affect the percentage of people receiving health insurance through employers or the number of insured Americans overall.
An analysis released by the Robert Wood Johnson Foundation and the Urban Institute finds that 250.9 million Americans would have health insurance if the employer mandate’s penalties for non-coverage were repealed versus 251.1 million if they stayed in place.
The study finds that 57.9 percent of Americans would have employer-sponsored health insurance if the mandate was repealed, down only slightly from the 58.1 percent estimated to have it if the mandate is enforced. It’s a 500,000-person difference.
One downside, according to the study: By repealing the mandate, the federal government would lose out on $46 billion in revenue between 2014 and 2023, and would have to somehow make up for the difference.
“In summary, eliminating the employer mandate would eliminate labor market distortions in the law, lessen opposition to the law from employers and have little effect on coverage,” the report concludes. “The individual mandate, together with the Medicaid expansion and income related subsidies, is, as we have shown elsewhere, critical to expanding coverage under the ACA; the employer mandate is not.”
The authors say that employers would continue to offer insurance despite the mandate because of the tax benefits health insurance coverage provides them.
The report adds fuel to the claims that the mandate, which will fine up to $2,000 for each full-time worker not ordered affordable coverage, will only hurt employers and do little to improve U.S. health insurance coverage.
Some employers have suggested they would drop their health insurance coverage and pay the fine when the mandate takes effect, while others have claimed they would have to lay off workers.
President Obama has already responded to complaints by delaying the mandate two years, to 2016, for employers with 50 to 99 workers. Those with 100 or more workers only need to offer affordable insurance to 70 percent of full-time employees in 2015, versus the previous requirement of 95 percent, The Washington Post reports.
There’s been growing speculation that President Obama plans to repeal the employer mandate. Avik Roy, a senior fellow at the Manhattan Institute for Policy Research, testified before Congress last summer that repealing it “would encourage a transition away from costly, inefficient employer-sponsored coverage, and towards portable, individually-owned insurance policies.”
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