Barely two months after Maryland passed a law requiring employers with more than 10,000 employees (i.e., Wal-Mart) to provide health insurance to their employees, there are those in Massaschusetts who would take this logical to the next step.
After a three-month stalemate, House and Senate leaders yesterday agreed to charge assessments on businesses that do not provide health insurance to their workers, clearing the way for the Legislature to enact a sweeping healthcare bill and make the state eligible for $385 million in federal Medicaid money.
At a closed State House meeting that included representatives of the business community, Speaker Salvatore F. DiMasi and Senate President Robert E. Travaglini agreed to assess companies with 10 or more employees that do not provide health coverage $295 a year for each worker, said several negotiators, who spoke on the condition of anonymity.
For a company with ten employees, that’s an additional $ 2,950.00 per year. The question, of course, is what a year’s worth of health insurance would cost the employer; if its more than $ 3,000 per year (which its likely to be), then you can expect to see most employers opting to pay the “penalty” rather than provide health insurance. The other side of the coin, of course, is that a company with ten or eleven employees need only reduce a few positions and it wouldn’t have to pay anything at all, either to the state or to an insurance company. In the end, then one can expect that this law would result in fewer people having health insurance and people working for smaller companies losing their jobs.
So much for that solution, I suppose. Of course, that’s not how the law’s supporters see it:
The size of the business assessment has been the major stumbling block to a settlement. Legislative leaders and other negotiators said the assessment was set at $295 in order to pay for the free state healthcare used by workers whose companies don’t provide health insurance. Widmer confirmed the size of the assessment yesterday, saying it would drop each year as more individuals have private insurance and do not rely on free care.
But, what happens if the scenario outlined above actually comes about and you end up with more people being covered by the so-called “free” health care provided by the state ? The answer, of course, is that the state will have to increase the “penalty” assessment rather than decrease it, which will give even more employers the incentive to dump their health care program or reduce the number of employees.
Of course, perhaps I’m asking too much to expect that kind of rational thinking to come out of the People’s Republic of Massachusetts.
Brad Warbiany also writes about this new law at The Liberty Papers and argues that the legislature in Massachusetts is forgetting that you can only push the economy so far before it breaks.
You push, and you push, and you push, and the system creaks and groans, but holds up against the pressure. Then you push a little farther, and people give up. Massachusetts is one of the few states in the country to lose population year over year. Even states like California, which lose large numbers of residents each year (a statistic I?m glad to be a part of), have enough immigration to offset the loss. Massachussetts isn?t called Taxachussetts without reason. And now they?re piling one more big tax on top of it all.
And over at Wizbang, Jay Tea welcomes the new law and the benefits it will provide to his home state:
So as Massachusetts prepares to shoot its economy in the foot, I look forward to the benefits we in New Hampshire will gain. And I find myself feeling just a little sorry for the folks of Massachusetts, about to get boned over again by the officials they keep re-electing.
But, of course, when that happens, the legislators in Boston will console themselves with the thought they meant well.
Related Posts:
First They Came For Wal-Mart
Little Tyrannies
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