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Drop Coverage? Cut Hours? Big Firms Grapple With Obamacare

At Whole Foods, workers who put in 30 hours a week already get full health benefits. Still, John Mackey, Co-Founder and Co-CEO of the grocery chain said the company may still be forced to reconsider its full-time staffing levels, because the proposed rules include more expensive benefit requirements.

"Say we're paying $3,200 a year for insurance for somebody, and the new regulations cost us $5,000 to insure somebody. If they work fewer hours, we just saved $5,000 per person," because there is no mandate to provide coverage for part-time workers, he explained.

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Health plan requirements are expected to include more benefits than what many retailers and restaurant chains now offer hourly employees, under tighter cost-sharing rules. The employee's share of the insurance premiums can't be any more than 9.5% percent of their income.

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In the end, the ACA may not stop the trend of employers dropping heath care coverage. Big firms may opt to pay the penalty of $2,000 for each full-time worker instead of funding costly plans.

In its latest budget projections, the Congressional Budget Office calculated that 7 million workers will lose employer coverage between 2013-2022, while the government will collect $13 billion more revenues from employer fines.

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The said irony of what may occur is the possibility that many lower income people that now have some coverage via their employer may find that they lose that coverage and instead have to buy it from an exchange - at a higher cost.
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