Senior Policy Analyst
The House Ways and Means Committee will consider budget reconciliation legislation this week to repeal health reform’s requirement that employers with more than 50 full-time-equivalent (FTE) employees provide affordable, comprehensive coverage to their workers or pay a penalty. Without this requirement, some employers, particularly relatively smaller ones, may stop offering coverage that their lower-income employees can afford — or stop offering coverage altogether. As a result, eliminating the requirement would erode employer-sponsored insurance and increase the ranks of the uninsured.
So far, it appears to be doing just that. A just-released survey finds that in 2015, 21 percent of employers with 100 or more FTEs expanded eligibility to include more workers and 5 percent now offer more comprehensive benefits to some workers who had received only limited benefits. (Also, the provision hasn’t caused employers to shift more of their workforce to part-time status, contrary to critics’ predictions.)
The Congressional Budget Office (CBO) — which estimated in 2013 that delaying the employer responsibility requirement by one year would leave 1 million fewer people with employer coverage (about 500,000 of whom would end up uninsured) — warned that repealing the requirement would likely cause even more people to become uninsured, relative to current law. That’s because employers would more likely end health insurance benefits for their employees if the requirement were repealed rather than postponed.