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Who’s Kidding Who about the ACA and Lost Jobs?

Who’s Kidding Who about the ACA and Lost Jobs?

Written by the owner of Quality News: Jared S. Ray

Who’s Kidding Who about the ACA and Lost Jobs?

Image courtesy of [winnond] / FreeDigitalPhotos.net 

I’m confused by the White House push-back to the February 2014 CBO report[i] which tripled the prior estimate for jobs expected to be lost due to the Affordable Care Act (ACA) – 2.3 million workers by 2021.  Decreased American jobs was an expected outcome of the implementation of the ACA / ObamaCare; wasn’t it?

The PPACA defines Employee and Hours of service partly as follows:

“(iii) Service of nonresident alien individuals and service outside the United States. Hours of service do not include hours of service to the extent the compensation for those hours of service constitutes income from sources without the United States…[ii]

And IRS rules regarding employer shared responsibility state:

“hours of service do not include hours of service to the extent the compensation for those hours of service constitutes foreign source income…..Thus, hours of service generally do not include hours of service worked outside the United States…Therefore, employees working overseas generally will….not quality as full-time employees either for purposes of determining an employer’s status…or for purposes of determining and calculating any potential liability under 4980H.”[iii]

I read the above to mean businesses might contemplate using near or offshore labor to provide hours of work so as to reduce the possibility of paying $2,000 – $3,000 per head, per year, for not providing affordable healthcare.

Maybe it was just the CBOs chosen language attributing the reduction to subsidy-coasting that was objectionable – “almost entirely because workers will choose to supply less labor – given the new taxes and other incentives they will face and the financial benefits some will receive.

If we’re honest, a much bigger reason why the ACA kills jobs is because it seeks to provide healthcare to just American workers.  It clearly doesn’t create jobs.  And it definitely doesn’t cover foreign workers.

This begs the question – If a business owes its workers health care coverage at all, that must be due to the worker providing the fruits of their labor and not because of where they reside, right?

Hate this proposal if you will; but, wouldn’t an extension of employer shared responsibility for health coverage of all employees (whether foreign or domestic) greatly increase our ACA coffers?  Think that through for a minute.  The BPOs will be upset.  Multi-nationals too I’d bet.  But can you tell me that wouldn’t create a rush to re-shore?  Wouldn’t domestic job growth benefit all (foreign workers included)?

The White House might want to own up to whatever ACA fallouts periodically arise because eventually the cost and other impacts of affordable care will become apparent.

Congress might want to look at amending the ACA statutory definitions of Employee and/or Hours of service.


[ii] 26 CFR 45.4980H-1 (21)(iii)

[iii] Fed. Reg. Vol. 78, No. 1, page 224

See also: Jobs in the Philippines (in-link)