In a nutshell, Obamacare offers up penalties for companies with 50 or more employees but subsidies for those with fewer.
However, if you examine the penalties, these larger employers could reap a windfall in profits by dropping insurance and throwing their employees on the mercy of government subsidies and their own pocketbooks to buy their own insurance.
First, off penalties don't kick in until a) one employee qualifies for a government subsidy to buy insurance and b) you toss out the first 30 employees, who are "penalty-free." Thus, say a company has 130 employees, the employer drops his health plan, and thereafter one or more employees qualify for a government subsidy. The employer will now be on the hook for a $750 fine for 100 employees (total workforce minus the 30-person threshold). Divided by 12 months, this comes out to $6,250 a month ($750 times 100 divided by 12).
Compare that to what he previously paid on insurance. Let's say the average employer portion of the health insurance tab each month was $250 (which seems low). That works out to $32,500 a month (130 employees times $250). This employer is now saving $26,250 a month by dropping his health plan. Even if he splits this with his employers in the form of a raise, he's still left with a tidy profit of $13,250 a month for complying with Obamacare mandates. That's a nice $159,000 a year he didn't have before.
Obamacare, don't you love it?
Let's face it--the whole point of the carrot-stick approach of Obamacare is to throw the nation's health insurance business into chaos, so the Obamacrats can come back and say: "See. We need Medicare for all."
By the dawn of the next decade, we can thus post signs, "Welcome to the Banana Republic of America." And then we can stand in line for health care we'll never get--but the politicians and fat cats will.
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