Obamacare News of the Day

Washington Times: Obamacare will push 2 million workers out of labor market: CBO [in 2011 CBO projected that the labor force would have 800,000 fewer workers by 2021]

• Obamacare will push the equivalent of about 2 million workers out of the labor market by 2017 as employees decide either to work fewer hours or drop out altogether, according to the latest estimates Tuesday from the Congressional Budget Office.
• “CBO estimates that the ACA will reduce the total number of hours worked, on net, by about 1.5 to 2 percent during the period from 2017 to 2024, almost entirely because workers will choose to supply less labor — given the new taxes and other incentives they will face and the financial benefits some will receive,” CBO analysts wrote in their new economic outlook.

The Foundry (Heritage Foundation): Obamacare Is Already Reducing Employment

• Although the Obamacare employer mandate will not take effect until next year, employee health insurance premiums have already skyrocketed. And surveys report that many business owners are making changes based on Obamacare in terms of employee hours and hires.
• Federal Reserve banks have heard the same concerns. The Federal Reserve recently released its January Beige Book, which “gathers anecdotal information on current economic conditions in its District through reports from Bank and Branch directors and interviews with key business contacts, economists, market experts, and other sources.”
  • Atlanta Fed: “On balance, many firms expressed continued hesitancy caused by concerns about healthcare reform in terms of their overall hiring plans” (p. VI-3).
  • Richmond Fed: “Employers continued to express concern about potential cost increases related to [Obamacare]” (p. V-4).
  • Chicago Fed: “Non-wage labor costs also increased, with a number of contacts reporting higher healthcare premiums” (p. VII-3).
  • Boston Fed: “Downside risks include the upcoming costs to businesses of compliance with [Obamacare] and the trend toward office downsizing on a space-per-person basis” (p. I-3).
  • Philadelphia Fed: “Firms also expected to see the largest increase in health benefits costs compared with other input and labor costs in 2014” (pp. III-1 and III-2).
  • Cleveland Fed: “A majority of our contacts cited rising healthcare insurance premiums as a concern” (p. IV-2).

KATU: New Cover Oregon allegations: 'If it's true, someone's going to prison' [you may recall: Oregon's state technology executive who developed much of the failed Obamacare site for Oregon resigned in December of last year]

• Former [Oregon} Republican state Rep. Patrick Sheehan told the KATU Investigators he has gone to the FBI with allegations that Cover Oregon project managers initiated the design of dummy web pages to convince the federal government the project was further along than it actually was. If Sheehan’s allegations are true, those managers could face time in jail for fraud.
• Early in its life, Cover Oregon was given a $48 million “early innovator” grant from the federal government. That amount would later grow to $59 million. There were a few strings attached though. To keep the money flowing, the website would have to hit specific benchmarks between 2011 and 2013. The state needed to show the feds it had picked a company to provide software and technical assistance; it had to demonstrate that the website was safe from hackers; and, most importantly, it had to show that people could actually sign up for insurance on the website.

The Washington Free Beacon: The Belarusian Connection

• U.S. intelligence agencies last week urged the Obama administration to check its new healthcare network for malicious software after learning that developers linked to the Belarus government helped produce the website, raising fresh concerns that private data posted by millions of Americans will be compromised.
• The intelligence agencies notified the Department of Health and Human Services, the agency in charge of the Healthcare.gov network, about their concerns last week. Specifically, officials warned that programmers in Belarus, a former Soviet republic closely allied with Russia, were suspected of inserting malicious code that could be used for cyber attacks, according to U.S. officials familiar with the concerns.
• “Belarusian President [Alexander] Lukashenko’s authoritarian regime is closely allied with Russia and is adversarial toward the United States,” the official added. The combination of the Belarus-origin software, the Internet re-routing, and the anti-U.S. posture of the Belarusian government “makes the software written in Belarus a potential target of cyber attacks for identity theft and privacy violations” of Americans, the official said.

Washington Post: In rural Georgia, federal health insurance marketplace proves unaffordable to many

• If Lee Mullins lived in Pittsburgh, he could buy mid-level health coverage for his family for $940 a month. If he lived in Beverly Hills, he would pay $1,405.But Mullins, who builds custom swimming pools, lives in southwest Georgia. Here, a similar health plan for his family of four costs $2,654 a month.
• This largely agrarian pocket of Georgia, where peanuts and pecans are major crops and hunters bag alligators up to 10 feet long, is one of the most expensive places in the nation to buy health insurance through the new online marketplaces created by the federal health law
• [In certain places] government subsidies are shielding people with low and moderate incomes from the full cost of the premiums. Randy Gray, a flower shop owner in Albany, is paying just $32 a month, with taxpayers picking up the remaining $805. But for those earning too much to qualify for federal financial help, the premiums can be overwhelming. A 60-year-old making $47,000 in Albany would have to pay a quarter of her income for the least expensive mid-level “silver” policy, the level most consumers are buying.

The Hill: House readies two more ObamaCare bills [House Ways and Means is marking these two bills up this morning and may have them on the floor in the coming weeks]

• …the Save American Workers (SAW) Act, H.R. 2575, would repeal ObamaCare's definition of "full-time employee." The law requires companies to offer health plans to their workers when they have more than 50 full-time employees, and says anyone working 30 or hour hours a week is classified as full time.
  • University of Chicago economics professor, Casey Mulligan, explains that this Obamacare fix may have popular appeal, but that it will not solve Obamacare's negative impact on full-time employment or its crushing blow to taxpayers. He writes of the same reform proposed by Senators Collins (R-ME) and Donnelly (D-IN):
    • Although it may be true that their proposal would prevent cuts in hours for those now working, say, 35 hours a week, it would be likely to cause cuts for employees working 40 to 45 hours a week, because staying short of the 40-hour threshold would be closer to their current work schedule than staying short of the law’s 30-hour threshold.
    • More important from an economic point of view, the 40-hour threshold would further magnify the already strong disincentives for working full time.
    • It’s one thing for public policies to present workers with a small reward for working full time. But the proposal from the two senators would put millions of people in the position of having to pay – in the form of less disposable income – for the privilege of working full time. When millions of workers choose part-time rather than full-time work under the Donnelly-Collins proposal, it will be taxpayers who pick up the tab.
• Ways and Means will also consider H.R. 3979, which would ensure volunteer firefighters are not treated as full-time employees under ObamaCare who must be offered health insurance. The sponsor of this bill, Rep. Lou Barletta (R-Pa.), says the IRS has indicated that it could treat these volunteer workers as full-time workers, which could trigger a finding that they must be given health insurance. The IRS said in a blog post in January that it would not treat them as full-time workers. But aides to Barletta said the congressman wants legislative certainty on this issue, rather than rely on a simple blog post.