Hatch amendment goes after employer health insurance penalties

Sen. Orrin Hatch (R-Utah) on Tuesday introduced legislation to exempt large businesses from the penalty soon to be applied to companies that don’t provide health insurance for their employees.

“The employer mandate would have the perverse effect of forcing businesses to let people go,” Hatch said Tuesday. “When we’ve got a near 10 percent nationwide unemployment rate, I can’t think of a more misguided policy.”

The Democrats’ new health reform law does not technically mandate that employers offer their workers health insurance. But larger companies — those with more than 50 employees — must pay a $2,000 penalty each year per employee if they don’t provide coverage to staff, and those workers instead would receive subsidies on state-based insurance exchanges.

Hatch's bill would exempt those businesses from paying the penalties if they can certify to the Treasury and Labor departments that the fines would result in company layoffs. The Utah Republican, the ranking member of the Finance Committee’s health subpanel, hopes to attach his bill to the sweeping tax extenders bill being considered by the Senate this week.

“Instead of spending more and more money [on] government programs," Hatch said, “let’s get business back in the business of hiring.”

Senate Democrats are hoping to pass the tax extenders bill before the end of the week.