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Here & Now has been talking with private businesses and also state governments and school districts that have cut hours of employees in response to the Affordable Care Act.
Starting in 2015, larger employers will be required to provide health insurance to employees working 30 hours or more. Those workers will be considered full time.
Kelly Gilreath, owner of Kelly’s Professional Cleaning Service in Greenville, S.C., says she has to cut her workers’ hours and wants the law repealed.
“To make it a law that one person has to pay for another person’s insurance, in my opinion, is not a good thing,” Gilreath told Here & Now.
JEREMY HOBSON, HOST:
It's HERE AND NOW, and we have been talking with many people with different views about the Affordable Care Act, including one company that is going to increase the hours for its employees in order to provide them with health care and perhaps reduce turnover.
But many companies are cutting hours to below 30 a week so they won't have to provide coverage starting in 2015, as would be required by the Affordable Care Act. One is Kelly's Professional Cleaning Service in Greenville, South Carolina. Kelly Gilreath is president and CEO. She's with us now. Welcome.
KELLY GILREATH: Thank you.
HOBSON: So you have said that you're going to have to cut worker hours because of the Affordable Care Act. Tell us about that.
GILREATH: Well, our product is labor. We don't have a tangible product that you put in your hand. And it's a very low-wage and highly competitive industry. You're competing against companies that, you know, they may be bidding for less than 10 percent profit on a contract. It's very competitive.
And whenever Obamacare came about, you have companies such as ours that are working in a low profit-type industry, you can't afford a big hit to those profit dollars when it's so competitive.
HOBSON: Well, I'm sure you've crunched the numbers. What would it actually cost you per employee to provide insurance?
GILREATH: For us to provide insurance for 50 employees would add an additional $142,000 a year to our expenses, at a minimum. And if you took the penalty, you're talking about adding an additional $60,000 a year.
HOBSON: Well, so what are your employees going to do then to get health insurance?
GILREATH: My personal opinion is, I think a lot of them will just opt to not do anything. I went online to try to get an estimate of what, you know, with the new...
HOBSON: With the new exchanges.
GILREATH: Yeah, with the exchanges, but the thing that I read just this week on one of the websites is the expected average per person is $396 a month. And for a person that makes $1,100 a month in income, you know, that's a big hit, and then if you expect the company to pay 60 percent of that, that's a big hit as well.
HOBSON: Well, I'm sure that there are a lot of people who are listening to this who are saying to themselves, well, you know, she says she can't afford it, but really she should be able to help pay for health care for her workers. What would you say to them?
GILREATH: Well, I think when it comes to businesses, I think you should provide an insurance that covers their protection on the job. To require business to provide insurance, I mean it's great, I would love to help everybody, I'm a giver at heart, but the problem is, that's something that you have absolutely no control over their individual lives or what their health insurance specifically is going to entail.
And I think there needs to be some reform, obviously, because insurance has gotten out of control, but to make it a law that one person's got to pay for another person's insurance is, in my opinion, is not a good thing.
HOBSON: Well, so what do you make of this situation that we're in right now, with the government being shut down because many people believe that the Affordable Care Act is a bad idea and should be defunded?
GILREATH: Well, I think they definitely need to go back to the table. They're making laws that shouldn't have anything to do with laws. I do think there needs to be some requirements on insurance and how insurance is handled, you know, and how insurance companies charge, particularly low-income people. But at the same time, I will say this law as it is needs to be reworked. It's not functionable for the employee, it's not functionable for the business.
I even spoke with a local insurance rep earlier. It's not even functional for the small insurance companies.
HOBSON: Do you think it should be repealed?
GILREATH: Yes, I do. I think they need - I think there needs to be reform, but I do think this law needs to be repealed.
HOBSON: Kelly Gilreath is president and CEO of Kelly's Professional Cleaning Service in Greenville, South Carolina. Kelly, thanks for joining us.
GILREATH: Thank you. Transcript provided by NPR, Copyright NPR.