Dumping the employer mandate?

The AP reported yesterday that the Senate may weaken or remove altogether a mandate in their version of ObamaCare that mandates businesses with more than 50 employees to provide health insurance coverage as part of their benefit package.  However, the bill will still include an individual mandate, with penalties set at least at $750 per person, and probably much higher:

Businesses would not be required to provide health insurance under legislation being readied for Senate debate, but large firms would owe significant penalties if any worker needed government subsidies to buy coverage on their own, according to Democratic officials familiar with talks on the bill.

For firms with more than 50 employees, the fee could be as high as $750 multiplied by the total size of the work force if only a few workers needed federal aid, these officials said. That is a more stringent penalty than in a bill that recently cleared the Senate Finance Committee, which said companies should face penalties on a per-employee basis.

These officials also said individuals would generally be required to purchase affordable insurance if it were available, and face penalties if they defied the requirement.

Why give businesses an exception or an easy out on the mandate?  After all, if the per-person fee gets applied, the cost to not provide health insurance will look cheap compared to the cost of providing it, especially since premiums will start moving up fast after ObamaCare gets passed.  Typically, businesses could pay more than $750 per month for some health insurance plans for each employee.  The cheap fine allows businesses to opt out altogether at a very low cost, forcing employees into the public option.

Also, this looks like a bribe of sorts to keep employers out of court.  An employer mandate may have similar constitutional problems as an individual mandate, at least for those employers whose business does not cross state lines.  However, businesses can afford to hire more and better lawyers than individuals in order to challenge it.  If they see this as a cheap mechanism to dump medical coverage costs, we can expect them to cheer it rather than sue and put the whole scheme in jeopardy of a Supreme Court reversal.

However, the optics of this look bad, and will look worse in practice.  The Senate will create a huge out for the business world at the expense of the individual workers, and when they take it, people will realize they’ve been had — especially the class warriors that comprise the narrowing base of the Democrats.  The only people stuck with an onerous mandate will be individuals, forced for the first time in American history to purchase a product in order to legally reside in the US.