What Obamacare Means for Business

As I have blogged before, there a many positives with the Affordable Care Act (Obamacare); however, there are also negatives.  One glaring weakness is the minimum cost of a health benefit package as projected by the Congressional Budget Office.  The cost of the benefit package will be $5000 for an individual and $12,500 for a family. That translates into an additional $2.28 an hour for full-time employees with individual coverage and an additional $5.89 an hour for family coverage.  Adding the cash minimum wage to the family coverage benefit, the new minimum wage for employers becomes $13.14 per hour.  Many employers can't afford the added cost of health insurance in this economy and that is why you hear that employers will reduce staff, reduce employee hours, raise prices or force employees into a health exchange.  Low and moderate wage earners would receive a generous subsidy from the government by going into an exchange, but higher income employees get no subsidy.  This would force low income workers to work in companies that don't provide health insurance with an expectation for higher wages.  The higher income worker will work for companies that provide health insurance.  This will be an unbelievable burden on the tax payer with millions of employees taking advantage of the government subsidized coverage.  It will be interesting to watch.  If companies ignore what these employees prefer, then they could go out of business.  Stay tuned.