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Union leaders shout displeasure over Affordable Care Act

February 13th, 2014  |  David Stephanides

In a story that has somewhat fallen off the radar, union leaders have once again made it known that they are not pleased with the Affordable Care’s Act treatment of multi-employer health plans. The reality, they stress, is 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 these plans. Many employers will feel the need to drop coverage and access the subsidies to remain competitive.

Updating the contentious issue, the Washington Post reported Jan. 31 that Obama Administration officials said “if the unions got their way, people enrolled in their plans would be indirectly getting two tax benefits while most Americans get only one.” 

“The unions here are asking to double dip,” said Robert Laszewski, a health policy consultant in Washington quoted in the Post article. “It is an unfair request. The Obama plan is very simple: If your employer pays for your health plan, you are not eligible for a government subsidy. What the unions are asking for is government and employers to fund their benefits.”

While union officials acknowledge that their plans are unique, they stress that the ACA didn’t take that into account. As a result, commercial insurers can cover anyone through the individual or group markets, while the multi-employer plans can’t. This creates unstoppable incentives for employers to reduce weekly hours for workers currently on these plans and push them onto the exchanges where many will pay higher costs for poorer insurance with a more limited network of providers.

“We thought that if we made the case to the agencies dealing with regulations to correct problems that hurt [our plans], really destroy, self-funded nonprofit health plans, it would be resolved,” said Donald Taylor, President of Unite Here, in the Post article. “That clearly was naive or stupid.”