It seems that the infinitely flexible (it means whatever we say it means) "law" that is DumbassCare is dropping yet another stinking turd into the mix. The IRS is ruling that employers may not dump employees into the DumbassCare exchanges to avoid having to shell out for the now infamously overpriced "plans" that the law mandates. If they do proceed to do that they will incur daily fines for every employee that they drop from company provided group insurance.
LINKWASHINGTON — Many employers had thought they could shift health costs to the government by sending their employees to a health insurance exchange with a tax-free contribution of cash to help pay premiums, but the Obama administration has squelched the idea in a new ruling. Such arrangements do not satisfy the health care law, the administration said, and employers may be subject to a tax penalty of $100 a day — or $36,500 a year — for each employee who goes into the individual marketplace.
The ruling this month, by the Internal Revenue Service, blocks any wholesale move by employers to dump employees into the exchanges.
Under a central provision of the health care law, larger employers are required to offer health coverage to full-time workers, or else the employers may be subject to penalties.
Many employers — some that now offer coverage and some that do not — had concluded that it would be cheaper to provide each employee with a lump sum of money to buy insurance on an exchange, instead of providing coverage directly.
But the Obama administration raised objections, contained in an authoritative question-and-answer document released by the Internal Revenue Service, in consultation with other agencies.
The health law, known as the Affordable Care Act, builds on the current system of employer-based health insurance. The administration, like many in Congress, wants employers to continue to provide coverage to workers and their families.
This is yet another move by the BO administration that destabilizes private businesses by not allowing them to plan for the future. The employer mandate is fast approaching. What will businesses do now?
My guess is that you will see some (but certainly nowhere near all) employers begin to shed any employees that they do not see as absolutely necessary. There will also be a certain percentage that will take the other DumbassCare dodge and shift as many employees as possible to part time working hours. This had already begun to happen but without the option of dumping employees into the exchanges it is my belief that we are going to see a new round of full time to part time status conversions. The bottom line in any case, though, is that the market will do whatever it needs to do to react to this new, artificial constraint on what would be their otherwise normal behavior in conducting business.
Another day, another decree by King Putt.
