• David Brooks on employee dumping

    I’m just flagging this, by David Brooks, as something to follow up on. But I’ve got to do some more research first.

    Employee dumping. This is the most serious threat. Companies and unions across America are running the numbers and discovering they would be better off if, after 2014, they induced poorer and sicker employees to move to public insurance exchanges, where subsidies are much higher.

    The number of people in those exchanges could thus skyrocket, especially as startup companies undermine their competitors with uninsured employees and lower costs. The Congressional Budget Office projects that 19 million people will move to the exchanges at a cost of $450 billion between 2014 and 2019. But according to the economists Douglas Holtz-Eakin and James C. Capretta, costs could soar to $1.4 trillion if those who would be better off in the exchanges actually moved to them. The price of the health care law could double. C. Eugene Steuerle of the Urban Institute, who has been among those raising the alarms about this, calls the law’s structure “unworkable and unfair.”

    This is pretty similar to most things I’ve read on this topic, from either side of the debate: a bit fast and loose with speculation, possibly based on extreme assumptions. I’ve already written many times (so, so, so, so, many times) about how employee dumping could be less than some people think, or not. Still, I’m not satisfied with any of this because it is not sufficiently evidence-based. I’ll come back to it.

    UPDATE: See Ezra Klein’s response to Brooks on this point and many others.

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