Report: Employers Cut Hours, Coverage Options Before ACA Was Passed
A trend of employers reducing workers' hours and health coverage options began before the Affordable Care Act was passed in 2010, according to a report released Wednesday by the Employee Benefits Research Institute, The Hill's "Healthwatch" reports.
Opponents of the ACA have alleged that employers have cut workers' hours to avoid the law's employer mandate (Baker, "Healthwatch," The Hill, 5/22).
Under the ACA, businesses with at least 50 workers beginning in 2014 must pay a penalty of $2,000 per employee if they do not provide affordable coverage to their employees. Employers will not be required to pay for the first 30 workers who are included in the penalty calculation (California Healthline, 3/26).
The study found that the percentage of part-time workers has been rising since before the ACA was signed into law in March 2010, increasing from 16.7% in 2007 to 22.2% in 2011. The report attributes the shift toward more part-time workers to the recent recession ("Healthwatch," The Hill, 5/22).
According to the report, "there is concern" that some provisions in the ACA "are expected to increase the cost of coverage" and could result in employers "cutting back on health coverage for part-time workers or increasing the proportion of part-time workers employed."
However, such a trend was occurring prior to the law. From 2007 to 2011, the likelihood that full-time and part-time workers had health coverage decreased by 2.8% and 15.7%, respectively. In 2011, 59.6% of full-time workers had employer-based coverage, while 15.7% of part-time workers had job-based coverage, the report found.
CQ HealthBeat notes that there have been reports of employers adjusting their employees' hours in order to avoid the mandate. Â
EBRI analyst Paul Fronstin declined to link the trend in reduced worker hours and benefits to the ACA, but he acknowledged that it could be a possibility. However, the analysis said that anyone who attempts to determine the ACA's effect on employees' hours or coverage should factor in that the trend started before the ACA was enacted (Reichard, CQ HealthBeat, 5/22).