Friday, July 26, 2013 | 2 a.m.
National union leaders criticized President Barack Obama’s signature health care law in a scathing letter sent earlier this month to Sen. Harry Reid, D-Nev., and Rep. Nancy Pelosi, D-Calif.
The signatories lambasted the law for “perverse incentives” that are already creating “nightmare scenarios” that could “destroy the foundation of the 40-hour workweek.”
Largely seen as allies to the Democratic president, union leaders from the International Brotherhood of Teamsters, the United Food and Commercial Workers, and UNITE Here went public with concerns that could affect all workers, not just unionized employees.
Employee unions often partner with employers to provide health insurance, and the union leaders are concerned that provisions of Obamacare could inadvertently lead to employers cutting hours for workers, dropping insurance coverage and bankrupting unions’ self-insured health plans.
Under their feared scenario, tens of thousands of workers in Nevada would earn less and pay more for health insurance.
The Sun talked to D. Taylor, the president of UNITE Here, the parent organization of Nevada’s largest union, Culinary Local 226.
Taylor, a Las Vegas resident, told the Sun what he believes is at stake for workers and why he’s concerned. His answers were edited for brevity:
You recently co-wrote a letter to Harry Reid and Nancy Pelosi in which you criticized the Affordable Care Act. In the letter, you mentioned a long process of bringing concerns to the Obama administration and ultimately not receiving the kind of treatment the employer community received when it got an extension for the individual mandate. How would you describe those conversations with the administration?
We have had over the last two years an enormous number of meetings ... The administration has repeatedly had all kinds of changes and waivers in the law that have accommodated all groups, including the Catholic Church, if you remember, on contraceptives. The employer mandate is just the most recent one, but there have been numerous others. They have completely shut out the concerns and unintended consequences that Obamacare has on nonprofit insurance plans … We want to just be treated as equals, no special treatment, just equals, and the unintended consequences of the act doesn’t do that, and frankly how the Treasury and IRS have interpreted it, the bill was intended to promote competition and in fact is doing just the opposite. It is driving not-for-profits to be unaffordable.
You mentioned unintended consequences and perverse incentives, including the 30-hour-a-week threshold for providing health insurance under the law. Aren’t union members protected from incentives to cut hours and benefits because unions have collective bargaining abilities?
Our interest isn’t just about union members. For example, on the front page of the New York Times yesterday it talked about these adjunct professors in Virginia that are all being cut down to 29 hours. Well, what does that do? That means that fewer people have employer-based health insurance. That puts much more strain on government. That’s a problem.
Just remember when you cut people less than 30 hours (per week, the threshold at which employers must provide health insurance), that means they make less money for their discretionary spend and they lose their benefits. It’s a double whammy.
How concerned are you that employers will seek to abandon the Taft Hartley (union health insurance) plans and relegate workers to seek health insurance coverage in state-based health insurance exchanges? Have employers brought up this topic in contract negotiations?
Obamacare right now has a perverse incentive to do exactly that. I am very concerned not just in Las Vegas but throughout the United States because I’ve been to, I’ve seen many employers start talking about: “Well, why don’t we just pay $2,000 (penalty fee per employee assessed to employers for not providing health insurance) and get out of it and the government will take care of you?” Well, that’s not what Obamacare was supposed to do, but you hear that more and more.
You also included in the letter that the ACA will make union employees basically be treated differently, and they’ll be ineligible for subsidies afforded other citizens. Why should union employees in a Taft Hartley health plan receive the same subsidies individuals on the health exchange will be eligible to receive?
Because the subsidies are for folks who qualify, up to 400 percent of the poverty level. Most of our members qualify for that. So why should a for-profit insurance company get a subsidy but a not-for-profit self-insured plan not get a subsidy? ... So it’s not a question of wanting anything special. We just want to be treated as equals. Let’s say they (employers) dump everybody, they no longer offer insurance, they pay a $2,000 per person fine, which is way lower than insurance costs. Somebody goes and gets health insurance on an exchange, which will be higher cost and less good and the money just goes to profits. So we’re saying, hold a second. Why are you discriminating against the not-for-profit, self-insured health plans?
In coming out with this letter in a very public way, that seems to be the culmination of some frustrations that have been going on for awhile now. Do you see this as leverage to actually get something done? Where do you see this going?
There’s no question we are very upset at the incredible unequal treatment. The employers just get their mandate moved back a year. The Catholic Church gets the law changed. Under the law, it says you’re supposed to get insurance after 90 days. Then they said “Oh, no, we’re going to make it one year.” They have accommodated and made exceptions for everybody except for non-profit, self-insured health plans.
Why has the administration not been able to come to some compromise with you guys? The public perception out there is that unions are very close to the Obama administration. Why has this not gone well?
You’d have to talk to them. You can’t talk to us. We’ve spent two years talking to all the different agencies. Their excuses are "we can’t do it under the law," and that’s just a ruse because they’ve made every other exception, including the one two weeks ago about the mandate and the quote from Valerie Jarrett is that “we are listening to business.” Well, they’re obviously listening to business on the one hand. On the other hand, they’re not listening to businesses that provide not-for-profit, self-insured health care.
What’s the role of our delegation here? Sen. Reid and the rest of the delegation?
Well, I hope they express this to the rest of their respective caucuses, both Democratic and Republican. Like I said, we’re not against. We’re very much supportive of health care reform. We use a quote from President Obama. He said all the time when he was campaigning in ‘08. It goes “If you like your health plan you can keep it.” Well, that’s not really true or going to be true if we keep on going down this path that the administration and the IRS have been going down.
Here we have people who have really good insurance: low cost, high quality insurance. And we have an act by Congress, signed by the White House that as it is today incentivizes employers to drop insurance, and it hurts not-for-profit health care. We think that that is perverse. That is not what the intent was.