September 29, 2014
OAKLAND, CAEmployee benefits specialists have discovered that large companies can comply with the federal governments employer mandate by offering their workers health plans that fail to include coverage for such services as hospitalization, mental health care, MRI and CT scans, specialist services, and other benefits. The discovery is causing controversy because it contradicts President Obamas promise that health reform would force employers to abandon limited coverage plans for more comprehensive benefits that employees need.
The largest companies are allowed to have the skimpiest plans, says healthcare economist John C. Goodman (Senior Fellow, The Independent Institute). They have to cover contraceptives, but they dont have to cover hospitalization or mental health or emergency room visits or even the services of specialists.
Small companies and individuals, by contrast, are forced to insure for benefits they may not want or need, said Goodman, who is author of Priceless: Curing the Healthcare Crisis. They are forced to insure for pediatric care even if they dont have any children. They are forced to insure for alcohol and substance abuse even if they are teetotalers.
Although the Affordable Care Act will require companies with 50 workers or more to offer their full-time employees affordable health coverage, firms that self-insure rather than buying commercial insurance may use an official, online minimum value calculator to determine if their plans qualify. These firms are exempt from providing hospitalization and other benefits as long as the calculator determines they cover 60 percent of the expected healthcare costs of their workers. This will put some employees in a serious predicament: having been offered such a plan, they are not eligible to buy a more comprehensive plan with subsidies in the Obamacare online exchanges.
This discovery has stirred debate among health-benefits experts over whether the Department of Health and Human Services (HHS) actually intended to enable large employers to offer their workers unexpectedly thin health coverage or whether the federal minimum-value calculator suffers from technical mistakes that make skimpy health plans appear to comply with Obamacares employer mandate when they do not.
Dr. John Goodman is available for TV, radio, and print press interviews through the Independent Institute. For media requests, contact Jeanette Goodman at 972.965.3380 ([email protected]) or Kim Cloidt at 202.725.7722 ([email protected]).