One in ten employers to drop health plans.
ObamaCare’s payment for performance could penalize safety net hospitals.
75 percent of the nation’s physicians may be employed by hospitals by 2014.
Hospitals: no progress on readmissions.
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No one really knows what will happen in the short run. However, the long run is easier to predict. Small firms will face no penalty for failing to offer coverage. Workers with low- to moderate-incomes will get a far more generous subsidy in the exchange than the tax exclusion (subsidy) than for health coverage obtained through work. If most of small firms’ workers are low- to moderate-income, there’s no doubt that these firms will drop employee health plans. The same is probably true for larger firms that employ a high proportion of low-wage workers. The $2,000 fine is much cheaper than the cost of providing coverage (plus, the first 30 workers are exempt from penalties). Firms that employ high wage workers will probably continue offering coverage due to the tax exclusion. However, over time larger firms will fragment into low-wage and high-wage employers. For instance, a firm employing lawyers and accounts could continue to offer coverage but outsource low-wage tasks to a firm that primarily employs low-wage workers. For example, there will likely be all manner of janitorial services that are all under 51 workers.
Why pay for an insurance plan when it is cheaper to pay a fine?
As you all have pointed out at this site many times, employers generally are likely to drop coverage for all below-average-income workers.
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