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A small percentage of employers might drop health care coverage altogether
Approximately 1 in 5 employers (20 percent) anticipate modifying eligibility requirements for health care coverage if the Affordable Care Act (ACA) is repealed, according to the results of a health care and employment law survey released by Littler.
The survey recorded responses from 1,220 in-house counsel, HR professionals and C-suite executives from a range of industries who answered questions about health care reform and state and local law changes that affect employers.
The ACA broadened the base of employees covered by health care, mandating that those who work 30 hours or more a week be offered coverage, noted Steven Friedman, an attorney with Littler in New York City. If the ACA is repealed, "I would be very surprised if employers didn't cut back on eligibility to where they were before the ACA," he said. Before the ACA, "many employers set the bar far higher than 30 hours a week to be considered full-timers," he noted; 40 hours was much more common.
The survey also found that if the ACA is repealed:
"Even though employers would save money if they cut back on coverage, there is the question of how such a change would impact employee morale and employee relations," Friedman said.
In the version of the American Health Care Act that passed the House of Representatives May 4, "the number of people who may be eligible for some subsidy may be greater than those entitled to a subsidy under the ACA," he added. "Overall, employees may receive less money but over a wider swath of the population," he explained, noting that there could be tax credits that phase out at incomes between $75,000 and $115,000. This "could make employers think about whether they should continue to provide a subsidy to employees when the government provides it," he said. However, he added, "Employers still feel heavily invested in providing health care to employees."
State Pre-Emption Laws on the Rise
Businesses have been challenged by the multitude of local laws imposing higher minimum wages, banning questions on job applications inquiring about criminal history and mandating paid sick leave, among other requirements.
"With the Trump administration working to overturn labor and employment rules and to reduce regulations at the federal level, employers can expect a continued increase in new regulations impacting the workplace at the state and local levels," said Michael Lotito, an attorney with Littler in San Francisco and co-chair of the Workplace Policy Institute.
"If there is any hope for more consistency, it may emanate from the recent surge of pre-emption bills under consideration in various states," according to the survey report. "At least half of the states have already passed measures precluding localities from imposing various types of additional requirements on private-sector employers; at least a dozen new pre-emption measures are currently pending."
These pre-emption laws typically are being enacted in states with Republican Houses and Senates as well as governors but that also have progressive cities, Lotito said. He expects to continue to see this type of pre-emption.
The survey report noted that due to changes in state and local laws impacting employers:
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While some states are pre-empting local laws, other states are adding employment law requirements. The survey found that the following percentages of employers had laws at the state or local level that impacted their businesses:
Survey respondents said they expected the following developments under the Trump administration:
Survey respondents said they hoped for the following:
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