Newsline Brief Archive
These are posts sent out to WGL Members on our member email List.
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12-09-09
Federal Health Care Reform Update
WGL is opposed to an employer mandate in any federal health care reform bill. While there is at least some effort to exempt some seasonal and part-time employment, we realize that many of our members will not be helped much by these proposed exemptions. Below is a quick report on what is happening with the seasonal employee amendments.
The current Senate bill (a 2,000-page bill identified as a Substitute Amendment to HR 3590) exempts any occupation that is seasonal by nature in which the employee works less than 120 daysper year. This would cover agricultural field work and probably some packing employment up to 119 days per year. In addition, an employer would not be considered a "large employer" if they had 50 or more employees for less than 120 days per year.
In the US Senate there are two proposals for exemptions from the employer mandate for coverage of seasonal employees:
- Senator Landrieu of Louisiana has Senate Amendment S. 3011. This amendment would exempt employers from covering for the first 90 days of employment.
- Senator Maria Cantwell of Washington has an amendment that would exempt part-time employment of up to 390 hours in a quarter. This amendment does not yet have a number because it has not yet been introduced, but should be in the very near future.
These amendments will be considered very soon, so if you want to weigh in on them contact your Senators in the next couple of days.
11-06-09
Health Care Reform Legislative Report
by Mike Gempler, WGL Executive Director
Having just returned from several meetings in Washington, D.C., with Congressional staff and agriculture industry lobbyists, the following report on the content and politics of the health care reform effort is offered:
The House bill, H.R. 3962, is scheduled to be voted on this weekend, but if D leadership doesn't think they have the votes they'll delay it. So far they are set for the vote. Generally speaking, this bill will cost employers about 8% of payroll unless they qualify for exemptions. Because of the employer mandate, the cost of this bill to employers and the lack of consideration of the challenges of administering the program for seasonal and high-turnover employees, we are joining the National Council of Agricultural Employers in not supporting this bill. We ask that you contact your representative to ask them to vote against the bill.
The three existing Senate bills will be combined through negotiations next week into a single Senate bill that will go to the floor of the Senate, perhaps just before Thanksgiving. If the Senate bill passes it will go to a conference committee to be combined with the House bill (assuming one passes). There will be opportunities over the next several weeks for changes in the bills by lawmakers. We have indications that there may be support for inclusion of more favorable language for agriculture, including a definition of seasonal worker with a longer threshold, or higher thresholds for small employer exemptions. Final passage of a bill may not occur until after the first of the year.
The only exemptions being considered at this time are small employer and seasonal employees. Ironically, many employers in Washington agriculture have been attempting to change their production mix so that they reduce seasonal employment and employ fewer people for a longer period of time. These employers will have fewer seasonal employees who qualify for an exemption and will pay more if they are not eligible for a small business exemption (which is unlikely for businesses that are able to offer this kind of employment to field workers).
Note: Any employee who is undocumented and using false documents will probably face a screening for legal status and won't be able to receive the health care that their employer is paying for. This will be the case for what is reportedly 70% of the agricultural workforce. This underscores the need to pass AgJOBS.
There are some employers, small businesses included, who already provide health insurance for their employees and who have been experiencing high and unsustainable annual cost increases. Some of these employers are lobbying for passage of reform in the hope that it will lower costs and eliminate these increases.
Summary of provisions impacting agriculture being considered in the debate:
- Employer mandate is a threat.
- Exemption for the agriculture industry as a whole is not politically possible.
- A seasonal employee exemption may be possible at some level.
- Full-time and part-time employees must be covered and paid for by the employer unless the employer is specifically exempted as a small employer or the employees meet a definition of seasonal employee in the bill.
- Currently the only definition of seasonal employee is one that works less than 120 days a year (4 months). In Washington, seasonal employees are often employed mid-May until mid-October (5 months), making it unlikely that most seasonal employees will qualify.
- Currently "small employer" exemptions thresholds are low. In the House bill, as of today, a $500,000 or less payroll gets full exemption; $750,000 and above payroll pays the full 8%. Payrolls between those levels pay 2-4%.
- Baucus Senate bill (S. 1760) requires paying $750 per full-time employee per year, with part-time employees pro-rated according to a formula.
The Senate finance committee bill (Cantwell is involved in this and serves on that committee) doesn't have an employer mandate, but does require some employer payment for every employee who receives subsidized care under the bill.
Here's a rough example of costs in the House bill using apple production figures:
- Assuming 200 worker-hours per acre per year; $11 per hour wages (payroll taxes not included) the annual payroll per acre is $2,200.
- Under the House bill, if your payroll is $500,000 or less, you pay nothing per acre. At the $750,000 payroll level, you pay $176 per acre per year (8%).
