Dems Claim A Typical Workweek Will Cost Taxpayers Billions
Democrats sparred with business owners Thursday over a bill that would raise the Obamacare definition of a full-time workweek from 30 hours to 40 hours.
Supporters of the Save American Workers Act claim that the current definition creates an incentive for companies to reduce workers’ hours below 30 per week, because Obamacare requires them to provide health insurance to all full-time employees.
Raising the definition of full-time work to 40 hours per week, they contend, will enable businesses to offer part-time workers more hours, and therefore higher pay. (RELATED: White House Veto Threat Makes a Pretty Good Case Against Obamacare’s Employer Mandate)
However, at a hearing held by the Senate Committee on Health, Education, Labor, and Pensions, Democratic Sens. Elizabeth Warren and Patty Murray argued that the proposed legislation would exacerbate the problem it seeks to solve, while at the same time shifting healthcare costs from businesses to taxpayers.
“This bill would actually create the problem it claims to solve,” Murray said, citing a Congressional Budget Office report which found that there are far more workers who put in 40 (or slightly more) hours per week than workers who put in 30 (or slightly more) hours.
As a result, the CBO estimates that, “roughly 1 million fewer people would enroll in employer-based coverage” if the new law passes, at least half of whom would likely go on to enroll in government-subsidized plans.
Based on the CBO’s findings, Murray concluded that “this bill isn’t only bad for workers—it would also shift the costs of providing coverage from businesses to taxpayers, driving up the deficit by $53.2 billion over the next decade.”
“In other words,” she said. “This Republican legislation puts big corporations and their profits ahead of working families and their health care.”
“This bill is corporate welfare,” Warren added. “I’m against adding $53 billion to the deficit so that corporations can push their costs and responsibilities onto the government.”
Several witnesses who testified at the hearing disputed those claims, saying the 30-hour rule hurts workers by forcing companies to cut jobs, hours and/or wages in order to comply with the employer mandate. (RELATED: Study: Obamacare Employer Mandate Will Disproportionately Hurt Low-Wage Workers)
According to Dr. Douglas Holtz-Eakin, president of the American Action Forum and a former director of the CBO, businesses tend to respond to any government mandate that raises their labor costs by “cutting jobs or compensation,” and in the case of the 30-hour rule, “it gives employers an incentive to potentially dramatically cut hours to avoid the mandate.”
Since Obamacare became law, he noted, “The rise in premiums has cost employees an average $935 per year and has reduced employment by 350,544 jobs nationwide.” (RELATED: States Could Benefit if Court Strikes Down Obamacare Subsidies)
Increasing the full-time threshold to 40 hours, Holtz-Eakin said, would protect more than 11 million employees who currently work between 30 and 40 hours per week from the threat of losing hours, pay or their jobs. It would also “shield most full-time workers without health insurance from being subjected to the possibility of losing 11 or more hours per week.”
According to the Hill, Senate Majority Leader Mitch McConnell has promised that the Senate will vote on the bill, which passed the House earlier this month by a 252-172 vote.
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