Posted by: Doug Henwood | July 19, 2013

Some unions complain about Obamacare, discreetly

A friend of LBO’s sent this along—a letter from three unions to the Democratic Congressional leadership complaining about Obamacare. It was not meant to be public, though it got leaked and is making the rounds—though not vigorously enough. In an effort to speed up the circulation, I’m posting it here. The unions are worried that their multiemployer plans are going to take a hit, a fact that the Obama administration seems not to care about despite all that unions did for them, and that employers are going to cut back on full-time workers and replace them with part-timers to evade the (postponed) employer mandate.

Dear Leader Reid and Leader Pelosi:

When you and the President sought our support for the Affordable Care Act (ACA), you pledged that if we liked the health plans we have now, we could keep them. Sadly, that promise is under threat. Right now, unless you and the Obama Administration enact an equitable fix, the ACA will shatter not only our hard-earned health benefits, but destroy the foundation of the 40 hour work week that is the backbone of the American middle class.

Like millions of other Americans, our members are front-line workers in the American economy. We have been strong supporters of the notion that all Americans should have access to quality, affordable health care. We have also been strong supporters of you. In campaign after campaign we have put boots on the ground, gone door-to-door to get out the vote, run phone banks and raised money to secure this vision.

Now this vision has come back to haunt us.

Since the ACA was enacted, we have been bringing our deep concerns to the Administration, seeking reasonable regulatory interpretations to the statute that would help prevent the destruction of non-profit health plans. As you both know first-hand, our persuasive arguments have been disregarded and met with a stone wall by the White House and the pertinent agencies. This is especially stinging because other stakeholders have repeatedly received successful interpretations for their respective grievances. Most disconcerting of course is last week’s huge accommodation for the employer community—extending the statutorily mandated “December 31, 2013” deadline for the employer mandate and penalties.

Time is running out: Congress wrote this law; we voted for you. We have a problem; you need to fix it. The unintended consequences of the ACA are severe. Perverse incentives are already creating nightmare scenarios:

First, the law creates an incentive for employers to keep employees’ work hours below 30 hours a week. Numerous employers have begun to cut workers’ hours to avoid this obligation, and many of them are doing so openly. The impact is two-fold: fewer hours means less pay while also losing our current health benefits.

Second, millions of Americans are covered by non-profit health insurance plans like the ones in which most of our members participate. These non-profit plans are governed jointly by unions and companies under the Taft-Hartley Act. Our health plans have been built over decades by working men and women. Under the ACA as interpreted by the Administration, our employees will treated differently and not be eligible for subsidies afforded other citizens. As such, many employees will be relegated to second-class status and shut out of the help the law offers to for-profit insurance plans.

And finally, even though non-profit plans like ours won’t receive the same subsidies as for-profit plans, they’ll be taxed to pay for those subsidies. Taken together, these restrictions will make non-profit plans like ours unsustainable, and will undermine the health-care market of viable alternatives to the big health insurance companies.

On behalf of the millions of working men and women we represent and the families they support, we can no longer stand silent in the face of elements of the Affordable Care Act that will destroy the very health and wellbeing of our members along with millions of other hardworking Americans.

We believe that there are common-sense corrections that can be made within the existing statute that will allow our members to continue to keep their current health plans and benefits just as you and the President pledged. Unless changes are made, however, that promise is hollow.

We continue to stand behind real health care reform, but the law as it stands will hurt millions of Americans including the members of our respective unions.

We are looking to you to make sure these changes are made.

James P. Hoffa
General President
International Brotherhood of Teamsters

Joseph Hansen
International President
UFCW

D. Taylor
President
UNITE-

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Responses

  1. well this definitely hits home more than most, my job cut my and most of my co workers hours to not have to offer us health care, some of us have had to get second jobs or just a new full time job it’s been a big set back for everyone in already tough times, I wrote something about this when I first learned we would be losing a whole day off work on my own blog if interested though I usually would not paste my own stuff on someone else’s page this issue especially affected me http://rigohc.wordpress.com/2013/04/27/the-casualties-from-the-frontline-of-reform-in-america/

  2. As long as workers are tied to notions of a fair wage, they will be pawns in the games of that class which owns the product of their collective labour time.

  3. Yes, Mike, but until we can figure out another way to feed, shelter and clothe ourselves with the product of our collective labour time, I’m not sure how we untie ourselves from said notions.

    That said, one has to wonder just what Jimmy, Joe and D. propose to do about about it if (when) their humble requests are flattly ignored.

  4. I’m a public health nurse & state employee. Our governor recently reduced all part-time workers hours to 29 in response to the ACA. The perfect excuse to continue attacking the state workforce. I’ve noticed new job postings for nurses are mostly hourly, no benefits. This is truly a terrible development. A mad race to the bottom. I’m trying to change jobs & have applied for the few full-time jobs still available with the state but am competing with part-time nurses that will work for less as they are desperate for more hours & benefits & managers are under pressure to cut the budget.
    I am bilingual, have 22 years experience as a nurse, have 2 college degrees & haven’t gotten a raise in 6 years. In other words, my salary is pretty low as it is. I’m being passed up because part-time nurses will accept less out of necessity.

  5. Most employers have significantly reduced their share of the joint costs such that the difference between individual and group health insurance costs are. or will eventually converge. This is exactly what the insurance industry wants: force the sick, old, and families out of the market. So this will at least two perverse effects: 1) private insurers will likely fight over a shrinking younger market, 2) other insurers will increasingly face adverse selection problems and state regulators to significantly curtail coverage and raise rates. Like the commercial liability crisis of the mid-1980s, there will be a massive “affordability and availability” health insurance crisis, only there will be little external “capacity” (i.e., ability to underwrite new risks) coming from other sources (e.g., European health plans). Each state insurance commissioner will be besieged by a problem they cannot possibly fix. Maybe when 70% of middle and upper-middle class Americans under 65 lose their health insurance coverage will a “medicare-for-all” program seem like the most cost-effective solution. Until then, don’t get sick until your 65th birthday!


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