Big companies weigh in on health care
Internal documents reviewed by Fortune, requested by Congress, show that many large companies are considering dumping health care coverage they provide in exchange for paying penalty fees to the government.
If these companies (ie Verizon, AT&T, Deere, and others) do, in fact, follow this course of action, the projected cost of the bill will skyrocket. Part of the assumption of the bill was that American employers would continue with their current health care coverage.
The health care legislation eliminated a company’s right to deduce retiree drug-benefit from corporate taxes. This dug into projected revenue, most publicized by AT&T and Verizon.
Representative Henry Waxman accused companies of using the numbers to undermine health care reform and exaggerate the burden it put on employers. Waxman demanded every document the companies created that discussed what the bill would do to their expenses. He also wanted to hold hearings.
Enter 1,100 pages of documents from AT&T, Verizon, Caterpillar, and John Deere.
The Energy Committee read the documents and canceled the hearings.
As it turns out, the numbers were not an exaggeration. The Committee’s majority staff issued a memo. The write downs were “proper and in accordance with SEC rules.”
All four companies continue to assess the costs and benefits of dropping coverage. Under the bill, employees losing health coverage must purchase health care through state-run exchanges. These companies are seriously considering just paying the penalty rather than continue covering health care for employees.
Posted on May 6, 2010, in Politics & The Economy and tagged AT&T, barack obama, cat, caterpillar, deere, health care, health care bill, health care reform, healthcare, henry waxman, house of representatives, john deere, obama, President Obama, verizon. Bookmark the permalink. Leave a comment.