August 23, 2013

Local governments across US cutting hours of part-time employees over Obamacare cost

While the debate goes on over Obamacare — Gov. Beshear says it will create 17,000 new jobs in Kentucky, and Sen. McConnell saying it will destroy the 40-hour work week — the Washington Post reported today that many local governments across the nation, facing hundreds of thousands of dollars in new health-care costs, are cutting the number of hours their part-time employees work. 

Many cities and counties are cutting employee hours 16 months ahead of the effective date of the provision in Obamacare that requires them to offer health-care coverage to all employees who work at least 30 hours a week. 
Some local officers are making the cuts early either because of labor contracts that must be negotiated in advance, or because employees who work at least 30 hours in the month leading up the January 2015 implementation date (of the mandatory coverage) would need to be included.
The Post reported the following examples: 
• Middletown Township, N.J., said it would reduce the hours of 25 part-time workers to avoid up to $775,000 in increased annual health-care costs.
• Bee County, Tex., said it would limit its part-time workers to 24 hours per weeks, when it’s new fiscal year starts Oct. 1.
• Brevard County, Fla., estimates the new mandate would cost the county $10,000 a year per part-time employee; the county’s libraries have already cut hours for 37 employees.
• Lynchburg, Va., has cut hours for 35 to 40 part-time workers.
• Chesterfield County, Va. (south of Richmond) said it likely would cut the hours of “several hundred” employees.
• Chippewa County, Wisc., will drop 15 part-time workers to avoid up to $163,000 in annual health care costs.
A senior fellow of economic studies at the liberal Brookings Institution,* a Washington, D.C.-based think tank, told the Post that he doesn’t think Obamacare will be a “big direct-cost burden” to cities and counties. 
* The Brookings Institution describes itself as a “independent and nonpartisan,” but a 2011 study examining the political donations of think tank employees, showed that 97 percent of Brookings’ employees’ political donations went to Democrats.