New Orleans The closer we get to 2014 and the full implementation of the Affordable Care Act or so-called Obamacare, the more our hopes for health security for all Americans are being dashed as we stumble over what appear to be loopholes in the law and its regulations large enough for companies to drag an army of sick, injured, and underpaid workers through. Embarrassingly, Pan American Life Insurance Group, New Orleans-based company with offices on Poydras Avenue, which calls itself the “Wall Street of New Orleans” is right in the thick of this mess in marketing to large employers bare-bones or “skinny” low cost plans that would provide fig leaf coverage for workers for preventive care only with nothing for hospital stays.
How can this be possible?
According to the Wall Street Journal, the problems allowing these kinds of insurance scams can be uncovered in the glaring light of a close reading of the regulations. Where most employers, experts, and government officials have seen the ACA as a mandate for “robust” insurance, the Journal reports that “…the rules make it clear that those mandates only cover plans sponsored by insurers that are sold to small businesses and individuals, federal officials confirm.” Citing a Citigroup Inc report, the Journal says, “That affects only 30 million of the more than 160 million people with private insurance, including 19 million people covered by employers….Larger employers, generally with more than 50 workers, need cover only preventive services, without a lifetime or annual dollar-value limit, in order to avoid the across-the-workforce penalty.”
The hope for workers shackled to these cheap rate employers is that though the company might avoid the $2000 per worker penalty for offering no coverage, if the worker opts out of the company bare-bones plan and goes to the state health exchange to buy fuller coverage they would have to be subsidized $3000 annually by the employer. To take advantage of the subsidized exchange plans a worker would pay about $70 per month for so-so midlevel coverage and if they were making more than $12 per hour their costs could go up to $140 for the full package. That’s still a good deal for full health coverage, but a lower waged worker would still have to be able to afford it, and that could be tough for many.
The employers who are thinking about stiffing their workers on these low-to-no coverage skinny plans are betting the odds favor them. Knowing how little they pay their workers, especially in the hospitality and food service industry, they think so few of them will be able to pony up the money to go the exchange route, that the few times they will have to fork over $3 grand will make it worth the bet for them. Companies in Texas like El Fenix, the Tex-Mex chain with 1200 workers, and San Antonio-based Bill Miller Bar-B-Q with 4200 workers are already indicating they are going with the bottom of the barrel options. For unions like Local100 or organizations advocating workers’ rights, I can already see the faces of workers coming in our offices to report being fired for having signed up for the exchange and costing their bosses an extra $3000. If credit card histories can disqualify people from jobs now, health care problems and health care coverage decisions will no doubt lead to firings of workers throughout the country. There may be some protections for such blatant discrimination, and surely there must be, but there are protections for firing workers for labor law violations, union activity, reporting EEOC and health and safety issues, and workers still get fired for such activity every day, as companies and the government essentially say, “Prove it!”
We are in for a hard, rough fight in the trenches to try to win good, affordable healthcare coverage for Americans, because the ACA is just the beginning, and it may not be as good a beginning as we either need or had hoped for.