Support Repeal of Employer Mandate Penalties

Support Repeal of Employer Mandate Penalties

Cosponsor Senate and House Repeal Bills

•    S. 20 – Sen. Orrin Hatch (R-UT) – American Job Protection Act – Referred to Senate Finance Committee.  27 cosponsors.

•    H.R. 1744 – Boustany (R-LA) / Tiberi (R-OH) / Barrow (D-GA) – American Job Protection Act – Referred to House Committee on Ways and Means.  9 cosponsors.

Employer Mandates are Bad for Everyone

•    Employer mandates amount to a tax on jobs – a dangerous anti-employment step to take in the middle of an uncertain recovery.  Mandates drive up the cost of goods and drive down employment and do nothing ultimately to address the root causes of increasingly expensive health care and coverage.

•    Employer mandates will inevitably lead to job losses, higher prices, fewer new retail and restaurant store openings, limited store hours and services as well as diminished tax revenues.

•    The health reform law (Patient Protection and Affordable Care Act, or PPACA) may also undercut existing employer-sponsored coverage.

PPACA Mandate Scheme Fundamentally Flawed

•    Ironically, it may prove cheaper for employers to no longer provide coverage and pay penalty amounts instead.  For example, a retailer with 52 full-time employees (defined as working 30 hours per week, on average) would pay approximately $520,000 to $780,000 (based on Kaiser Family Foundation estimates) for coverage.  This retailer could also owe penalties for failure to provide affordable coverage if the cost of that coverage exceeds family income thresholds. 

The same retailer would owe a penalty for failure to provide any coverage to his or her full-time employees of $44,000 (52 employees minus the first 30 employees times $2,000).  Could a derivative lawsuit theory be built based on a corporation’s failure to lower coverage costs, for example from $780,000 - $520,000 plus any unaffordable care penalties to $44,000?

•    Visit NRF’s Health Care Mandate Cost Calculator to model the penalty amounts on different-sized employers.  www.nrf.com/healthcare.