Thursday, May 20, 2010

Road to ruin, good intentions, etc. - Opinion Journal: "Goodbye, employer-sponsored insurance - Companies are discovering that it's cheaper to pay fines to the government than to cover workers." Alternate title: how AT&T can save $1.8 billion just like that [snaps fingers].

6 comments:

Ed G. Mann said...

The bottom line gets fatter as the corps. take the difference between insurance costs and fines and put that into the pocket.

Why should anyone think they will give that money back in higher salaries, unless you are a convicted socialist.

One isn't going to push for the money in this economy, not if you like your job.

The effects of the Hopey-Changey thingy playing out.

Brian said...

Well, that's AT&T. My small firm, which pays 100% of my insurance for me and my family, and is barely making through the down economy, will never do such a thing like that. How do I know? Because Obama said so. I have hope!

Ned said...

Ah me, ah my! If only we lived in a world where the kind of health benefits being discussed were part of a compensation package under United States contract law, and therefore could not be unilaterally taken away without, er, compensation!

Anonymous said...

Umm, there have never been any fines for not providing insurance up til now - so why do all these employer-sponsored health insurance plans exist? Shouldn't they have all been eliminated long ago? After all it would have been cheaper to do so even absent any fines. Because they are a benefit desired, yea demanded, by employees, that's why. Imposing expensive additional coverage requirements is a different matter, but the fines are irrelevant. To be clear, I do NOT agree with Obamacare, but let's at least make sensible arguments against it.

Brian said...

I agree. The fact that Obamacare would incentive companies to push their employees into government-run care is not a sensible argument against it. After all, everyone will just quit their jobs over their employer dropping health care and join the competition, who will of course will pay the extra money rather than the fines.

Dope.

Anonymous said...

Brian, do try to keep up. If true, AT&T (or Verizon, or John Deere) being able to save billions by paying the fine is an argument FOR health care reform, not against it.

And as all those companies deal with unionized workforces, they are legally obliged to compensate their employees for any reductions to their health coverage. Government-managed health care will make this easier to do, not harder. You may recall that HMO coverage was one of the central issues in the CWA's last round of bargaining with AT&T in 2009; it figures to be one of the contentious issues in Verizon's upcoming labor talks.

It would also be more profitable for AT&T to pay its workers in sticks and twigs. U.S. law prevents them from doing so, at least until the next contract. And the free market dissuades them from instituting twig salaries in the next contract. Not if they want to acquire and retain the workers they wish to keep. It's a pure business calculation which involves weighing costs and benefits... just like the speculative "continue health coverage or pay the penalty?" one. Ayn would approve.