Is Obamacare Good For Credit Unions and Bad For Their Employees?
Well, we’re entering the third day of the health care exchanges set up to allow Americans who don’t have health insurance to purchase it cost effectively. So far the world has not ended, Democracy as we know it has not been overrun by tyrants, and I don’t feel that Big Brother is watching me anymore today than last week.
One of the most unfortunate consequences of the Congressional side show euphemistically described as a government shut down has been that this country has yet to seriously grapple with the profound impact for better and for worse that Obamacare will have on the American workplace. Leaving aside the moral question of the Country’s obligation to provide health insurance to the almost 50 million Americans who do not have it (after all, I’m a lawyer, not a priest), the reality is that the health care changes are going to impact every employer in America. This is particularly true of credit unions, since most of them have 50 or fewer employees but already provide health care.
So let’s say you’re the typical credit union with fewer than 50 employees who work at least 30 hours a week. You already provide health care and theoretically Obamacare doesn’t have to impact what you do in the slightest. But, you also have an eye for the numbers and like many employers, the cost of health care is biting more and more into your bottom line. The result has been that over the last several years, your employees have been asked to pay for a larger share of the health care premium. The 800 pound gorilla in the room for credit unions and their Boards of Directors, is this: at what point do you consider having your employees shop for their own insurance through health care exchanges, rather than the credit union taking on the responsibility?
From a moral standpoint, you don’t want to generate savings at the expense of providing your employees with adequate health care options. Conversely, if the networks perform as envisioned, your employees will still have access to a baseline quality of care, albeit with slightly less choice within a given network. Chances are, your credit union is not too far away from having your employees go out and get health care on their own, and helping them cover the cost either in the form of higher salaries or direct health care subsidies. In many ways, this is already happening for most employees who are paying higher co-pays and/or larger premiums for the same access to care.
Now, let’s say you are one of those credit unions that have 50 or more employees who work at least 30 hours a week. Statistically speaking, your credit union already provides health care so you don’t have to worry about the fine to be imposed on large employers who don’t provide health insurance. Does this mean that health care changes won’t affect you? Of course not. Again, it is possible that if the networks work as envisioned, you may actually find it cheaper to pay the fine and encourage your employees to go out and buy their own health care. Too draconian, you say? The problem is that nothing in the health care law will actually do anything meaningful to keep down health care costs. In fact, the number of employers offering health care dropped dramatically over the last decade. As health care costs continue to rise, your credit union is going to find it impossible to both remain competitive and provide the same level of care to which your employees have grown accustomed.
The bottom line is that Obamacare is taking effect. Health care costs were rising long before the Affordable Care Act and whether you are a Tea Party Conservative or a Move-On.org Liberal, the framework established by the statute and its regulations is one that all credit union managers and directors should be aware of as they grapple with health insurance over the next decade.