2013-12-10
The Demonick Diatribes – #7
Obamacare, an easy choice for employers
President Obama has delayed key portions of his signature accomplishment, his legacy, and fulfillment of his promise to "Fundamentally Transform America". Why?
Let’s first put some real-world numbers to the choice a small company owner will eventually have to make, whether to continue to provide their employees with healthcare insurance or throw them into the maelstrom and onto the mercy of The State healthcare exchanges.
And let’s make it personal.
YOU are a business owner. You have poured your life blood into building a company over 25 or more years. For years you worked 80 to 100 hour weeks. You paid your employees and your vendors before you paid yourself. Over the last 10 years you have finally gotten to a place where you can live a more normal life, your business has stabilized and managed to survive the last 5 years of the Obama Administration. You are looking forward to retiring in the next decade and turning over the company to one of your children. It is their future too.
Now YOU have a choice to make. Time after time with simple signatures to executive orders president Obama has unconstitutionally and illegally changed binding legislation passed by congress. Among the legislative changes the president ordered was a delay in the “employer mandate”.
The so-called “employer mandate” is a choice. Either an employer provides State Approved Healthcare Insurance plans at considerable additional cost, or they cancel healthcare insurance coverage for their employees, pay a fine, and throw them on the mercy of The State insurance exchanges.
Hearing this, many Americans feel those greedy, miserly bastard business owners can surely afford the small increase in cost and continue to provide healthcare insurance for their employees.
Remember, this is YOUR company. You built it by an incredible act of will and with incredible effort. You provide a valuable product people want. You have managed to stay ahead of your competitors. And, you have afforded your employees the opportunity to build comfortable lives, raise families, send children to school, and have a modicum of stability and peace in their lives.
You have 100 full-time employees. You know them all by name. You care about their welfare. You have known many of them for decades. They have worked hard for you and you appreciate it. You have tried to compensate them fairly and as best you can. You know their families. You have been to their weddings, their childrens’ weddings, and to their funerals. You feel like your employees are an extended family.
Each month with premium and administrative costs providing healthcare insurance costs you on average $500 per employee per month. That is $50,000 per month for all your employees – $600,000 per year.
You are finally making a comfortable net at the end of the year. Your current yearly profit is $1,000,000. With this you pay yourself, and finance any company growth or unusual expenses such as new marketing campaigns.
The provisions of Obamacare are going to double your healthcare insurance premium and administrative costs. Each employee is going to cost you $1,000 per month. Your yearly healthcare insurance cost will rise from $600,000 to $1,200,000 a year. This $600,000 increase comes right off your yearly net. So now, rather than having $1,000,000 in the bank to pay yourself and grow your company you only have $400,000. Obamacare has cut your pay by %60.
If you cut your employees loose and let them fend for themselves on The State insurance exchanges you are subject to a fine of $2,000 per employee per year. Total fine for the year is $200,000 for your 100 employees. Throwing your employees to the mercy of The State saves you $400,000 a year and raises your yearly take to $1,400,000. You have increased your pay by %40.
So, YOUR choice is between taking home $400,000 a year or $1,400,000 a year. A difference of $1,000,000 a year, a 350% difference. Remember out of this you need to pay yourself and grow your company. Out of this you need to meet increased competition by other players in your industry.
What do you think your competitors are going to do?
If you continue to provide healthcare insurance for your employees how will you answer an aggressive marketing and pricing push by your major competitor?
What if you don’t have the funds to repel your competitors’ encroachment on your customer base?
What will happen to your employees if you have to lay some off?
Your company, your life’s work, the sustenance you provide to 100 full-time employees and their families is at risk. Either you drop healthcare insurance for your employees or there is a very real chance they will all lose their jobs when you are driven out of business.
YOU must make a decision.
What do YOU do?
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