In a Friday afternoon news dump last week, the Department of Health and Human Services announced that they would stop accepting applications for waivers from ObamaCare's restrictions on insurance with annual spending limits after September 22, 2011 and that granted waivers would last for three years instead of the current one year. What does this mean to you? Simply put, this new waiver policy is a job killer.
If businesses don't apply for an ObamaCare waiver by this date, they are completely out of luck and forced to provide more comprehensive health coverage than they can afford. That will neccessarily lead to fewer jobs than would otherwise be available.
In a complex, dynamic economy such as ours, there are a myriad of scenarios about how this could play out. The following are just two that come to mind:
- The most obvious scenario is for businesses that will be created after September 22, 2011 and thus won't be able to apply for a waiver. When they are eventually up and running, and the very real cost-savings enabled by a waiver is the difference between hiring additional employees, jobs will truly be put on the line by this new policy.
- A second and unfortunately foreseeable scenario is that businesses may in the future decide that they can no longer afford to provide comprehensive health coverage to some or all of its workers.
This newfound unaffordability can simply result from of a decline in the amount of business transacted, or from skyrocketing health care costs that ObamaCare has only made worse. If struggling businesses are not allowed to minimize the level of coverage they provide, some employees could be laid off in order to afford paying for more comprehensive coverage for other employees.
The bottomline is that employers need maximum flexibility to run their operations, and when government imposes arbitrary mandates, unintended consequences result, such as sizeable job losses, as will surely play out in the above scenarios. President Obama should rescind this new job-killing waiver policy before it is too late.
Alex Cortes is the Executive Director of Let Freedom Ring, a nonprofit that promotes constitutional government, economic freedom and traditional values.