Trade Group Claims Millions Will Lose Health Insurance Under Obamacare

National Association of Manufacturers says the law will have the opposite effect than intended

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AP Photo/Charles Dharapak

President Barack Obama tours a distribution center for Safeway stores in Upper Marlboro, Md., Tuesday, Feb. 18, 2014.

UPDATE: 5:32 p.m., Feb. 25 — The National Association of Manufacturers was forced to retract its original claim, reported in this story, that 60 million employees would lose their health insurance as a result of the health care law, revising the number down to six million. The group said the error was due to a misreading of a Congressional Budget Office report on the law.

The new health care reform law was intended to expand health insurance coverage to more than half of the 50 million people in America currently uninsured. But one trade association warned Tuesday that it will end up driving 60 million manufacturing workers out of coverage supplied by their employers over the next decade unless it’s fixed.

“Ninety-seven percent of manufacturers offer health coverage to their employees, but the health care law threatens their ability to provide these benefits by forcing them into a one-size-fits-all system,” Jay Timmons, the CEO of  the National Association of Manufacturers, said in his annual State of Manufacturing speech on Tuesday. “If we don’t do something to fix the law, more than 60 million fewer American workers will have employer-sponsored coverage in 10 years. That will be the new reality for your workforce.”

The charge that Obamacare would drive employers to dump 60 million workers into the law’s state and federal insurance exchanges is one of the more explosive ones made by critics of the Affordable Care Act. The Centers for Medicare & Medicaid Services released a report on Monday concluding that 11 million small business employees may see their premiums rise under Obamacare. The rocky rollout of the federal health insurance exchange website last year and repeated delays or extensions to key implementation deadlines have kept the controversial law at the center of political debate.

The delays aren’t enough, Timmons said. The association has a laundry list of changes it would like to see made to the law, including the repeal of $22.2 billion in fees over the next three years that help pay for the law, and the scrapping or drastic revision of the mandate that employers provide coverage. Timmons argued that rising health care costs have already adversely impacted small manufacturers with less than 50 employees. The group said it arrived at 60 million based on a Congressional Budget Office report that forecast a reduction in full-time work hours, but later retracted the claim and acknowledge a misinterpretation of the CBO report.

“Staub Manufacturing Solutions in Dayton, Ohio, which only has 22 employees, saw a 21 percent increase in health care costs last year, and it’s projecting a 91 percent increase this year,” Timmons said. “The company’s president made this very obvious statement: ‘The Affordable Care Act is far from affordable.’”

The nonpartisan Congressional Budget Office reported earlier this month that the implementation of Obamacare might reduce the number of fulltime hours worked to the equivalent of two million fewer full-time jobs in the economy, although the Obama administration touted this as evidence the law would give workers flexibility to change jobs and work hours without worrying about health insurance.