Comment: Large employers may have found a loophole to escape Obamacare’s draconian requirements. So-called ‘skinny’ plans cover only what Obamacare requires in the way of screenings and preventive services, but strip away hospitalization and everything else typically thought of as ‘health insurance’. Small businesses are pursuing their own escape hatches, such as early renewal of existing plans and self-insurance. Skinny plans could force sick people to the individual market and thus endanger Obamacare’s exchanges, which depend on large numbers of healthy policyholders for financial viability (enter ‘insurance death sprial’ in our searchbox). Blame the evil corporations? No, the blame for all this perversity belongs squarely on Obamacare’s supporters who, with their Progressive mindset, think they only have to snap their fingers and everyone will hop to. Of course people will find loopholes and ways around laws that are oppressive and unworkable. That’s human nature and par for the course. Progressives are continually surprised when their grand coercive schemes fall apart, but we’re not. Why fight human nature, as the Progressives do? Why not align with human nature and head back in the direction of fee-for-service medicine? The healthcare train went off the track in World War II when salaries were capped and employer health insurance became tax-deductible to sweeten the pot. It all had to do with government-imposed wage and price controls during the war, so don’t miss the point: There was nothing wrong with fee-for-service medicine in the first place and no great clamor to get rid of it. The train went off the track for extraneous reasons.
“Employers are increasingly recognizing they may be able to avoid certain penalties under the federal health law by offering very limited plans that can lack key benefits such as hospital coverage.”
“They cover minimal requirements such as preventive services, but often little more. Some of the plans wouldn’t cover surgery, X-rays or prenatal care at all.”
“Federal officials say this type of plan, in concept, would appear to qualify as acceptable minimum coverage under the law, and let most employers avoid an across-the-workforce $2,000-per-worker penalty for firms that offer nothing.”
“It is unclear how many employers will adopt the strategy, but a handful of companies have signed on and an industry is sprouting around the tactic. More than a dozen brokers and benefit-administrators in 10 states said they were discussing the strategy with their clients.”
“Some benefits advisers still feel they could face regulatory uncertainty.”
Employers Eye Bare-Bones Health Plans Under New Law
By Christopher Weaver and Anna Wilde Mathews
The Wall Street Journal – Sun, May 19, 2013