Amid strong lobbying by business groups, support is growing to end the Affordable Care Act's employer mandate, a change that would see millions more Americans buying their health insurance through exchanges.
With a number of state Chambers of Commerce backing Medicaid expansion in states like Missouri, the president and CEO of the U.S Chamber, Thomas Donohue, is working to "repeal onerous healthcare taxes" and "repeal, delay or change the employer mandate."
"The administration is obviously committed to keeping the law in place, so the Chamber has been working pragmatically to fix those parts of Obamacare that can be fixed," Donohue said in his annual address in January.
The Obama administration has been trying to flexibly phase in the employer mandate, delaying it until 2015 for large groups and until 2016 for employers with fewer than 100 full-time staff.
Now, Washington's research community is strengthening the case for rethinking the employer mandate's value. Urban Institute policy analyst Linda Blum and colleagues recently estimated that repealing it would have a marginal impact on the rate of overall insurance -- perhaps just 200,000 fewer insured, they estimate.
Modeling current trends in employers offering health benefits and the number of people who would be eligible for exchange tax credits or Medicaid, they found that eliminating the employer mandate could temporarily raise the national uninsurance rate by just 0.6 percent.
The Congressional Budget Office has estimated that delaying the mandate would leave a lot more people uninsured -- about 1 million. But the CBO's model "implicitly assumes more employers will drop insurance coverage under the ACA," Blum argues in a research brief co-authored by John Holahan and Matthew Buettgens.
"On balance, the individual mandate and tax benefits will keep most employers offering coverage regardless of the penalty," they write. "And those that drop because of the ACA will have done so because of other provisions in the law."
Repealing the employer mandate, they continue, would "substantially diminish employer opposition to the ACA" by removing a large administrative burden. It could also help employees by ending the problem of "job lock," freeing would-be entrepreneurs dependent on their company's insurance to start their own business while buying an individual health plan.
For the federal government, repealing the employer mandate would also cut off a few billion dollars in annual revenue -- $4 billion in 2016 and $46 billion over a decade, Blum and colleagues estimate.
At the same time, repealing the employer mandate or amending its 30-hour-per-week full-time requirement could end up as one of a few bipartisan causes in Congress, with Democrats and Republicans taking up the issue.
While the employer-sponsored tax exemption is unlikely to be repealed any time soon, ending the employer mandate is a real possibility, and could lead to further erosion of the group insurance market, while increasing the individual markets of public exchanges.
It may also pave the way for employers, especially self-funded plans, to ask and pay certain high-risk employees to opt-out of their group plan and instead turn to exchanges.