Founder and President Emeritus
Update, January 7: We’ve updated this post to reflect information in a new Congressional Budget Office analysis of the House bill.
While political leaders often stretch the truth to make their case, they usually don’t claim the opposite of the truth. That, however, is essentially what Republican congressional leaders are doing by claiming that a measure before the House tomorrow to alter a provision of health reform will safeguard the 40-hour work week and thereby protect workers. House Ways and Means Chairman Paul Ryan claims in today’s USA Today, for example, that the bill will enable “more people [to] work full time.” In fact, it clearly will do just the opposite.
The issue is the Affordable Care Act (ACA) requirement that employers with at least 50 full-time-equivalent workers must either offer health coverage to employees who work at least 30 hours a week or pay a penalty. On Thursday, the House will vote to limit this employer requirement to employees who work at least 40 hours a week. In the same vein as Paul Ryan, House Speaker John Boehner and Senate Majority Leader Mitch McConnell have claimed the measure would protect the 40-hour work week by “removing an arbitrary and destructive government barrier to more hours and better pay created by the Affordable Care Act of 2010.” Some news accounts have taken this claim largely at face value, essentially presenting it as a fact.
But the claim is preposterous. Here’s why:
To date, there has been little evidence that employers are shaving employees’ work hours to avoid the ACA’s employer mandate. One reason is that so few workers are at risk of having their hours reduced — only 7 percent of U.S. workers work between 30 and 34 hours a week (i.e., within five hours of the 30-hours threshold) and thus risk having their hours shaved to put them below the threshold.
By contrast, 44 percent of U.S. workers work 40 hours a week (and several percent more work between 40 and 44 hours a week).
As a result, it’s the Republican leaders’ proposal that would weaken the traditional 40-hour work week by placing far more workers at risk that employers will cut their hours to push them below the threshold. As the Congressional Budget Office (CBO) states in a new report, “because many more workers work 40 hours per week (or slightly more) than work 30 hours per week (or slightly more), [the House bill] could lead employers to make changes that would affect many more workers than will be affected under current law.”
Influential conservatives such as Yuval Levin and Ramesh Ponnuru agree that the Republican proposal would place more workers at risk of having their work hours cut.
That proposal would have a second effect as well — it would allow employers with 50 or more employees who do not offer coverage to employees working 30-39 hours a week to do so without facing any penalty. That would be a boon to affected businesses and corporations. But it would impose a hit not only on some affected employees, but also on taxpayers. That’s because large employers who don’t offer coverage would escape penalties for workers who are employed 30-39 hours a week, and also because the lessened availability of employer-based coverage would push more employees who work those hours into the ACA’s insurance marketplaces — generally with federal subsidies to make coverage affordable — or into Medicaid. CBO estimates that the proposal would boost government costs — and budget deficits — by $53 billion over 11 years.
CBO also says that the bill would cut the number of people with employer-based coverage by about 1 million, raise the number of people with coverage through Medicaid, the Children’s Health Insurance Program (CHIP), or insurance exchanges by between 500,000 and 1 million, and thus raise the number of uninsured by up to 500,000.
The ACA remains controversial, and lawmakers have every right to propose changes in it. But let’s try for a little more truth-in-advertising about what proposals would and wouldn’t do, especially when they would affect large numbers of Americans.