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Labor leaders break ranks with Obama over Affordable Care Act

May 30th, 2013  |  David Stephanides

Labor officials representing several unions have hit the press recently with comments lamenting the Affordable Care Act. A once very quiet effort to persuade the Obama Administration to make changes is now being made very public. Here is a running tally of unions that have voiced, rather harshly, some concerns:

UFCW: “It makes an untruth out of what the president said – that if you like your insurance, you could keep it. That is not going to be true for millions of workers now.” Joe Hansen, President

Operating Engineers: “We’re concerned that employers will be increasingly tempted to drop coverage through our plans and let our members fend for themselves on the health exchanges.” David Treanor, Director, Health Care Initiatives

United Union of Roofers: “In the rush to achieve its passage, many of the Act’s provisions were not fully conceived, resulting in unintended consequences that are inconsistent with the promise that those who were satisfied with their employer-sponsored coverage could keep it. I am therefore calling for repeal or complete reform of the Affordable Care Act.” Kinsey Robinson, President

Teamsters: “We are going back to the administration to say that this is not acceptable.” Ken Hall, General Secretary-Treasurer, expressing the reality that if federal subsidies are available only for plans purchased through state exchanges, employers contributing to multiemployer plans will face tremendous economic pressure to stop contributing to multiemployer plans…. Many employers will feel the need to drop coverage and access the subsidies to remain competitive.

In an op-ed published in The Hill last week, UFCW President Hansen lays out the nagging problem facing many unions.

“… [A]s currently interpreted, the ACA would block these plans [multiemployer plans through which some unions bargain collectively to provide health care insurance for their members - often called “Taft Hartley Plans”] from the law’s benefits (such as the subsidy for lower-income individuals and families) while subjecting them to the law’s penalties (like the $63 per insured person to subsidize Big Insurance). This creates unstoppable incentives for employers to reduce weekly hours for workers currently on our plans and push them onto the exchanges where many will pay higher costs for poorer insurance with a more limited network of providers. In other words, they will be forced to change their coverage and quite possibly their doctor. Others will be channeled into Medicaid, where taxpayers must pick up the tab.

In addition, the ACA includes a fine for failing to cover full-time workers but includes no such penalty for part-timers (defined as working less than 30 hours a week). As a result, many employers are either reducing hours below 30 or discontinuing part-time health coverage altogether. This is a cut in pay and benefits workers simply cannot afford. For example, a worker making $10 an hour that has his or her schedule cut by six hours a week would lose $3,100 a year in income. With millions of workers impacted, this would have a devastating effect on our economy.

So far, the administration has not responded to the unions on their concerns, at least not publicly.  The state insurance exchanges must be in place by October of this year so that they are ready for a January 1, 2014 launch. Time is running out.