Tuesday, June 25, 2013

Interesting Circle

I haven't commented on this aspect of the "employer mandate" for health insurance because I haven't figured out what it means. Having finally decided that it doesn't mean anything, I'm going to go ahead and comment on it anyway, because I find it interesting.

Why did employers begin offering health insurance in the first place? As a way to raise wages despite government wage controls. Government was fighting inflation and placed limits on prices and wages, and so to attract employees in a tight labor market, employers offered health care and/or health insurance as incentive. Kaiser Industries actually had its own doctors and clinics. It's not quite that simple, but...

So now business is trying to reduce wages. And instead of capping wages as they did in the past, the government is effectively mandating increased wages in the form of health insurance.

And we rant about the ill effects of "unfettered capitalism."

1 comment:

bruce said...

One side effect of the employer mandate that we are experiencing is that part timers will be limited to 25 hrs/week to avoid the provision of requiring coverage for all full timers 30+ hrs/week. But they can purchase insurance through CalCare or whatever they are going to call it.

This may conflict with a state mandate that colleges can't have more than 25% of classes taught by part timers (I think that's what it is). Sucks for the staff, though.

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