Obamacare and employment-based health insurance
The Obama administration and the IRS act to ensure that employers don’t just dump people onto the exchanges:
When employers provide coverage, their contributions, averaging more than $5,000 a year per employee, are not counted as taxable income to workers. But the Internal Revenue Service said employers could not meet their obligations under the health care law by simply reimbursing employees for some or all of their premium costs.
Christopher E. Condeluci, a former tax and benefits counsel to the Senate Finance Committee, said the ruling was significant because it made clear that “an employee cannot use tax-free contributions from an employer to purchase an insurance policy sold in the individual health insurance market, inside or outside an exchange.”
If an employer wants to help employees buy insurance on their own, Mr. Condeluci said, it can give them higher pay, in the form of taxable wages. But in such cases, he said, the employer and the employee would owe payroll taxes on those wages, and the change could be viewed by workers as reducing a valuable benefit.
Andrew R. Biebl, a tax partner at CliftonLarsonAllen, a large accounting firm based in Minneapolis, said the ruling could disrupt arrangements used in many industries.
“For decades,” Mr. Biebl said, “employers have been assisting employees by reimbursing them for health insurance premiums and out-of-pocket costs. The new federal ruling eliminates many of those arrangements by imposing an unusually punitive penalty.”
When an employer reimburses employees for premiums, the arrangement is known as an employer payment plan. “These employer payment plans are considered to be group health plans,” the I.R.S. said, but they do not satisfy requirements of the Affordable Care Act.
These “unusually punitive penalties” are to the tune of $100 a day per employee, bringing it to a grand total of $36,500 per year per employee.
The administration was faced with an interesting dilemma. Which was worst of all its options? Forego all those extra tax dollars and allow employers to assist employees as in the past? Run the risk of letting employers dump people into the horror of the exchanges, which could cause widespread dissatisfaction not just for those who use the individual insurance market (which has already occurred) but for the much larger number of people who previously had been helped out by employers? Many of these people would not qualify for subsidies and the coverage for them would be both more expensive and far worse than what they were probably used to.
None of this would seem to bode well for the all-important election, but apparently the powers that be decided that getting the tax dollars and forcing the employers to provide Obamacare-compliant insurance off the exchanges was the best combination for their purposes.
There’s other Obamacare news, too, although I’m not at all sure that this is actually “new.” I seem to recall reading and writing about something very much like it quite some time ago (see also this):
In a new [sic?] regulation, the Department of Health and Human Services said it would provide financial assistance to certain insurers that experience unexpected financial losses this year. Administration officials hope the payments will stabilize premiums and prevent rate increases that could embarrass Democrats in this year’s midterm elections.
Republicans want to block the payments, which they see as a bailout for insurance companies that supported the president’s health care law.
I can’t imagine that it’s only Republicans who “see” it that way. What else could it possibly be?
Let your reps know you oppose any bailouts to the companies that sold out to the regime and jumped on the obamacare wagon. This should be an effective talking point for the coming elections, along with the rest of the mess of obamacare.
So not only do government backed monopolies get to force you to buy their shatty products, but when they go bankrupt, you get to pay the taxes that pay their vacation benefits.
Ymarsakar,
We taxpayers will only have to front 50% of their vacations benefits, the other 50% will be borrowed from those who are still willing to buy T-bonds… a shrinking population largely residing within the Federal Reserve cartel.
“The Obama administration and the IRS act to ensure that employers don’t just dump people onto the exchanges:”
Predictable consequence; more lay offs, many full time employees hours reduced to part-time at 29 hrs and sharply increased consumer prices.
“the other 50% will be borrowed from those who are still willing to buy T-bonds” parker
My understanding is that the Fed is buying up much of the T-Bonds with billions of worthless paper money printed out of thin air. The world’s governments are engaged in a Ponzi scheme, its legalized theft from future generations…
The economic history of Honolulu tells the future.
The dynamic nature of business turnover ( birth and death of businesses, themselves) will cause 29 hours to be the ‘new normal.’
Something like this has already happened in France.
What happens is that crony firms that have indirect access to the government stash can carry on the same old way. Uncle sugar picks up the tab.
New businesses start up with virtually the entire staff limited to 29 hours per week. The construction trades are already shifting over to this as I type. The other tick is to only ever hire on an as-needed short-term basis. The troops are laid off before they can ever qualify for mandated benefits.
Plan B is to lay off the ENTIRE old workforce — in a rolling lay-off — and replace them with newbies at drastically lower W-2 wage levels. In this manner, the employer doesn’t pay for 0-care at all.
Instead, the entire medical burden moves away from employers and onto the backs of the employed. Congress(D) de facto having pre-spent all of the wage gains the labor force has attained over the last two generations.
Mandated benefits merely reflect pre-spent/ pre-allocated spending dictated by the PTB towards ‘political goods’ that the PTB want to fund — from the public weal.
Between one thing and another, about half of all wage income is being taxed away towards these ‘political goods’ — starting with anyone with a full time job.
( Medical mandatory expenditures are EXTREMELY regressive since they are dictated by mere existence. If your labor output is too low, you are on the dole.)
Taken as a whole, Barry is vectoring enough wealth towards Black America to have it totally dependent upon his pen. At this point in time, it is impossible for a Black American to NOT be subsidised by Big Government.
1) Either they are directly on the dole, or…
2) They are AA’d into heaven, or…
3) They work in allocated job slots inside Big Government, or…
4) They sell to Big Government, or…
5) They work the Reparations Industry….
Hence, this voting segment is totally politicised.
Likewise, the medical-pharma-insurance cartel is totally crony’d.
The aim is towards a one-party state.
(like Hawaii or Chicago or Indonesia)
Establishment Republicans could hit the cronyism meme hard and peel off disenchanted Democratic voters. It’s obvious that Obama has favored both Wall Street and the insurance industry.
The problem is, establishment Republicans support cronyism, too.
Disgusting.
Republicans clapped when the DC thugs executed a woman that got lost and ran into a DC concrete barricade.
They know which side of their bread the butter is on.
“My understanding is that the Fed is buying up much of the T-Bonds with billions of worthless paper money printed out of thin air.”
The Fed is the major purchaser of T-bonds, and have been for over a year. When the petro dollar is dumped on the ash heap by those 19th century regional powers (Russia, China, India, Iran, Brazil, etc.) those who have not been paying attention, though utter ignorance or willful blindness, are going to be in for a big surprise.
“The world’s governments are engaged in a Ponzi scheme, its legalized theft from future generations…”
When it comes to an end (2, 5, 10 years?) full blown war will be the only alternative to keep the domestic population(s) from burning down the house.
Burning down the house, soft version, live:
http://tinyurl.com/ka4e98h
Printing more money, redistributes wealth right now. It takes the value of the money from the poor and those without political connections, and gives it in pure value to the real estate mogols and powerful corporations backed by Democrat ruthlessness.