A “fix” to the Patient Protection and Affordable Care Act proposed by unions would force taxpayers to pay nearly $190 billion to extend subsidies to union health plans, according to an analysis by a right-of-center policy institute.
“Should the administration move to accommodate their union supporters, we estimate it would cost nearly $190 billion over 10 years,” wrote American Action Forum health-care analysts Emily Egan and Conor Ryan.
President Barack Obama was re-elected in 2012 with the financial backing and support of the country’s biggest labor unions, but lately a rift has formed between the White House and its union base over key elements of Obamacare. Namely, the 40-hour work week and tax subsidies.
Unions have been urging Obama and congressional Democrats to make changes to Obamacare in order to give union members enrolled in union health plans access to taxpayer subsidies.
“You allow an [Affordable Care Act] bill to go through like this, I guarantee you by your next convention four years from now, you won’t meet a quarter of this room. We won’t be here,” Joseph Nigro, president of the Sheet Metal, Air, Rail and Transportation Union, said during a floor debate.
Currently, the health law excludes Americans who have the option of affordable employer sponsored insurance, which many union members do as a result of the Taft-Hartley Act.
“Our health plans have been built over decades by working men and women Under the ACA as interpreted by the administration, our employees will treated differently and not be eligible for subsidies afforded other citizens,” Jimmy Hoffa Jr. of the International Brotherhood of Teamsters and other union heads wrote to Democratic leadership. “As such, many employees will be relegated to second-class status and shut out of the help the law offers to for-profit insurance plans.”
However, extending subsidies to union workers would add an additional 3 million households onto insurance rolls and cost taxpayers an extra $16 billion in 2014 alone, and if “the number of union members in Taft-Hartley plans remains constant, this estimate grows to $187 billion within the first 10 years,” according to Egan and Ryan.
Unions also worry that the health law, as its currently interpreted, would “destroy the foundation of the 40 hour work week that is the backbone of the American middle class” because Obamacare incentivizes employers to keep their employees working under 30 hours a week to skirt insurance requirements under the law.
“And finally, even though non-profit plans like ours won’t receive the same subsidies as for-profit plans, they’ll be taxed to pay for those subsidies,” the unions wrote. “Taken together, these restrictions will make non-profit plans like ours unsustainable, and will undermine the health-care market of viable alternatives to the big health insurance companies.”
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