Although the employer mandate provision of the Affordable Care Act (ACA) does not come into effect for another 16 months, many cities and state with tight budgets are facing the decision of cutting employee hours or risk going over their tight budgets due to higher employee insurance benefits.
According to The Washington Post, many local governments across the U.S. are seeing their annual healthcare costs rise as their budgets tighten. To combat this issue, some cities and states are reducing their full-time staff and increasing their part-time workforce by cutting employee hours. The Washington Post reported while employer healthcare premiums may not be rising as they once were, budgets are becoming more restricted.
Money News reported many local governments see the measure as their only option, despite the one-year delay of the employer mandate provision. However, some officials don’t see ACA as the main reason for the increase in part-time government workers; if municipal budgets weren’t so restricted, the governments may be able to afford the rise in care.
Yet this may be a temporary measure for many local governments. According to The Washington Post, Jason Furman, chairman of the White House Council of Economic Advisers, said the number of full-time positions available will increase when ACA comes into effect.