Employer Mandates in Hawaii: A Model for Universal Health Care?

Hawaiians have been complying with employer mandates, which require businesses to provide health insurance to employees, for decades. The experience in Hawaii has been generally successful, with about 95% of residents having health insurance. The mainstream view is that employer mandates have a negative impact on businesses, leading to massive layoffs and bankruptcies. However, the Kaiser Family Foundation found that this was not the case in Hawaii. In fact, many businesses in Hawaii have found ways to cope with the mandate by raising prices, holding down wages, and hiring more part-time workers. The majority of businesses in Hawaii still support the idea of employer mandates, even if they are worried about rising health costs.

Key Takeaways:

• The Hawaii experience shows that employer mandates can be effective in providing universal health care, with about 95% of residents having health insurance.
• The Kaiser Family Foundation surveyed 500 small employers in Hawaii and found that the mandate did not lead to massive layoffs or bankruptcies.
• Hawaiian businesses have found ways to cope with the mandate, such as raising prices, holding down wages, and hiring more part-time workers.
• The majority of businesses in Hawaii still support the idea of employer mandates, even if they are worried about rising health costs.
• Rand economist Dana Goldman estimates that about 85% of the cost of health mandates is passed on to workers in the form of lower wages.
• The extra cost to companies of providing health benefits is unlikely to be passed on to consumers in the form of higher prices, at least not in the short term.
• President Clinton has proposed universal health care coverage, which would require employers, individuals, or both to pick up the tab.
• There is no painless way to pay for expanded insurance coverage, and the question is whether employer mandates are a fair way to go.

Statistics:

• 95% of Hawaiians have health insurance.
• 85% of the cost of health mandates is passed on to workers in the form of lower wages.
• 500 small employers in Hawaii were surveyed by the Kaiser Family Foundation.
• $1,700 is a low estimate for the premium cost per employee under an employer mandate.
• $2,200 is a higher estimate for the premium cost per employee under an employer mandate.
• 95% of Hawaiians are happy with their health care and insurance.

Sources:

• NPR's Patricia Neighmond
• The Kaiser Family Foundation
• Drew Altman, President, Kaiser Family Foundation
• Paul Kasasa, Chairman, Retail Merchants Association of Hawaii
• Freda Levin, Owner, Regent Book Company
• Dana Goldman, Rand Economist