Another benefit of Obamacare you probably didn’t know about
Richard Mayhew, the pseudonymous health insurance expert blogging at balloon-juice.com (and a must-read on insurance issues), points us to a subtle benefit provided to unionized workers by the Affordable Care Act: It gives them more leverage in contract negotiations with employers.
That’s because it gives employees a backstop against the employers’ withdrawal of health insurance during a strike.
Here’s how that works. The goal of each side in a strike is to impose the maximum economic hardship on the other. For employers, it’s the loss of business; for employees, the loss of wages and benefits. It’s not unusual for employers to freeze pension contributions and end health benefits during a strike.
As Mayhew observes, “Pulling health insurance is an effective (and underhanded) way of dividing union solidarity as it pits the members who are either old or sick or who have old or sick dependents against members who don’t have pressing medical needs. Someone whose daughter needs chemotherapy next week will push leadership to take a [crummy] deal far faster than someone whose kids eventually need to go in and get their teeth cleaned.”
The federal law known as COBRA limits this option, as it allows workers to continue their health plans for up to 18 months -- if they pay the full premium themselves. That could put health insurance out of reach of many families.
Enter Obamacare. Mayhew notes that the loss of health coverage is a qualifying event under the Affordable Care Act allowing locked-out or striking workers to go on their state or federal exchange and buy coverage. It might not be as good as what they were receiving from their employers, but as a stopgap it’s almost certain to have lower premiums than COBRA coverage.
This is one very modest way that the Affordable Care Act counterbalances the drawbacks of America’s reliance on employer-sponsored health coverage -- and counteracts what has been a steady shift of employer-employee relations toward the former over recent decades. When you hear Obamacare’s critics demand its repeal, you might wish to ponder this one more bit of evidence about who would gain, and who would lose.