Obamacare: Large Grocery Chain Drops Coverage for Part-time Workers

Posted: Jul 12, 2013 10:43 AM

Real consequences for real people:

Et tu, Wegmans? The Rochester-based grocer that has been continually lauded for providing health insurance to its part-time workers will no longer offer that benefit. Until recently, the company voluntarily offered health insurance to employees who worked 20 hours per week or more. Companies are required by law to offer health insurance only to full-time employees who work 30 hours or more per week. Several Wegmans employees confirmed part-time health benefits had been cut and said the company said the decision was related to changes brought about by the Affordable Care Act.

The Buffalo News helpfully tracked down an "expert" who explained why the dropped coverage is a "win-win" for everyone involved:

Part-time employees may actually benefit from Wegmans’ decision, according to Brian Murphy, a partner at Lawley Benefits Group, an insurance brokerage firm in Buffalo. “If you have an employee that qualifies for subsidized coverage, they might be better off going with that than a limited part-time benefit,” Murphy said. That’s because subsidized coverage can have a lower out-of-pocket cost for the insured employee while also providing better benefits than an employer-paid plan. Under the Affordable Care Act, part-time employees are not eligible for health insurance subsidies if their employer offers insurance. “It’s a win-win. The employee gets subsidized coverage, and the employer gets to lower costs,” Murphy said.

First of all, the American people were made a solemn promise, over and over again:"If you like your health care plan, you will be able to keep your health care plan. Period. No one will take it away. No matter what.”  Many part-time employees at Wegmans may have been very rather pleased with their existing coverage, which will no longer exist because of the new law.  So much for "no matter what."  That's not a win, that's a broken promise.  Secondly, thanks to the administration's outrageous anti-fraud verification delay, anyone can claim that they qualify for Obamacare subsidies.  Correctly determining eligibility is essential to maintain any prayer of marginal cost containment, but that process is proving logistically problematic -- so the administration is simply going full speed ahead without that key safeguard in place.  Third, notice the hedging on claims that Obamacare will lower costs for these employees.  "Might, can," etc.  The fact is that many people who will receive subsidies (with an intended cut-off at relatively low income levels) will still pay more than they currently do.   This is especially true for younger, healthier people.  Say, who tends to work at grocery stores?  Wegmans' young employees -- stripped of their previous coverage -- now have plenty of incentive to forgo expensive insurance costs and just pay the lower mandate tax.  If enough young, healthy people go this route, the Obamacare completely collapses.  For more on those dynamics, read this.  Meanwhile, here's a local news report from Pennsylvania, highlighting the trend of businesses reducing hours and opting to hire temporary workers to avoid Obamacare's (recently postponed) employer mandate:

One last Obamacare "bonus:"  An Iowa insurance branch is shutting down after six decades of operation because of Obamacare, taking more than 100 jobs with it.  "Own" this "fabulous" law, Democrats.  Prove why Republicans are so "scared" of its, er, success.