As the website for Health Connect, Vermont’s new health insurance marketplace, becomes easier to navigate, employers and employees are finally getting a closer look at the way new policies will affect their pocketbooks. For some, workplace insurance makes financial sense, but for others, it doesn’t.
At Onion River Sports in Montpelier, for example, the holiday shopping season is in full swing. But owner Andrew Brewer has been comparison pricing something much more complicated than a pair of skis. He’s been reluctantly asking employees personal questions about their household incomes, trying to figure out how the new health care policies would affect them.
“And that has been quite surprising… the clear winners and losers, even within my population of employees. It’s very vast,” Brewer said.
Onion River Sports employs about 50 people. About half work more than 30 hours a week. Under the Affordable Care Act, Brewer must either offer insurance to those 25 workers, or pay a penalty. But not every employee can afford to sign up.
Take, for example, Christina Morris. She has a child and is pregnant. Her husband does not work at Onion River Sports, and is not insured. But since her employer offers family coverage at what the federal government calls an affordable rate, her husband and kids must come with her into the exchange, or pay a penalty to remain uninsured.
“He now has to pick it up through me, as does my daughter and this baby that I am carrying now, which puts us into paying almost four times what I pay weekly for health insurance,” Morris estimated.
She says that would consume almost a whole paycheck. For employees like her, it might be better if Onion River stayed out of Vermont’s new health care marketplace. Many workers without employer-sponsored insurance qualify for state and federal subsidies if they buy their own policies on the exchange.
But employer Andrew Brewer says he would feel obliged to raise wages to help his workers’ pay their share of those costs.
Sounds fair? It’s not that simple.
“What does that mean for Onion River’s payroll taxes? It would go up four or five thousand dollars a year, I think, in payroll taxes [from] Onion River. More payroll taxes [from] the employee because now they are getting a raise, so now it affects their tax situation as well,” Brewer said.
Brewer would also pay a yearly $12,000 penalty for not providing health insurance. And he wants to provide it. But he also knows some of his employees can’t afford workplace policies for their entire families. All that’s creating some unexpected consequences. Some full-time workers are actually asking to have their hours cut.
“And that’s maddening, You know I have ready, able, willing employees, and they are starting to make decisions: ‘well, you know if I cut back a day a week I can get under the thirty and that way I won’t be eligible for Onion River’s health care plan,’” he said.
For the company’s bottom line, Brewer said, there’s not much difference between going into or staying out of the exchange. He’s more concerned about the best outcome for his workers. He does see plusses and minuses for them, and he wishes the application process was less complex. For that reason, he supports recent calls for yet another delay in implementation.
Meanwhile, a few employers, including the Addison County town of Bridport, are moving in the opposite direction, giving employees stipends to shop the insurance exchange on their own.
