Big corporations may turn against Obamacare

  • 1 December 2014
  • NormanL
Obamacare - Barack Obama unhappy

It's no secret that several large U.S. corporations supported obamacare">Obamacare's passage in 2010 because they viewed the law as a way to help them cut costs and improve their bottom lines. But now, some of those big business backers are having second thoughts...because of federal lawsuits targeting corporate wellness programs:

A bipartisan provision in the 2010 healthcare reform law allows employers to reward workers who participate and penalize those who don't.

But recent lawsuits filed by the administration's Equal Employment Opportunity Commission (EEOC), challenging the programs at Honeywell International and two smaller companies, have thrown the future of that part of Obamacare into doubt.

The lawsuits infuriated some large employers so much that they are considering aligning themselves with Obama's opponents, according to people familiar with the executives' thinking.

"The fact that the EEOC sued is shocking to our members," said Maria Ghazal, vice-president and counsel at the Business Roundtable, a group of chief executives of more than 200 large U.S. corporations. "They don't understand why a plan in compliance with the ACA (Affordable Care Act) is the target of a lawsuit," she said. "This is a major issue to our members."

Another case of "we told you so?" Perhaps. These lawsuits are grounded in another federal law that is supposed to ban workplace discrimination against the disabled. So it may be more like a "Catch-22":

One of the arguments presented in the lawsuit against three employers is that requiring medical testing violates the Americans with Disabilities Act.

That 1990 law, according to employment-law attorney Joseph Lazzarotti of Jackson Lewis P.C. in Morristown, N.J., largely prohibits requiring medical tests as part of employment.

"You can't make medical inquiries unless it's consistent with job-necessity, or part of a voluntary wellness program," he said.

The lawsuits are based on the view that it is no longer voluntary if employees face up to $4,000 in penalties for non-participation, loss of insurance or even their jobs.

The corporate honchos are very publicly weighing whether to turn against Obamacare entirely.  They should have done that from the start.