Sorry it took so long. My response to Eugene and others raising the same question is here:
http://balkin.blogspot.com/2013/12/hobby-lobby-part-iii-adoes-federal-law.html As always, I welcome any critiques/suggestions from list-members, thanks. On Wed, Dec 18, 2013 at 11:36 AM, Marty Lederman <lederman.ma...@gmail.com>wrote: > I apologize for not responding right away, but I'm slammed with other > stuff. There is a lot to say here, and I think it's important -- Eugene is > raising some good questions. I'll try to respond in the next day or so; in > the meantime, I'm very grateful for all the reactions, both supportive and > critical (and both!) . . . please keep them coming, thanks. > > > On Tue, Dec 17, 2013 at 9:10 PM, Volokh, Eugene <vol...@law.ucla.edu>wrote: > >> The heart of Marty’s argument (I focus for now on item 1 below) is, I >> think, an empirical claim: Large employers such as Hobby Lobby would be >> better off just dropping coverage, paying the $2000/employee/year tax, >> “us[ing] some of [the] enormous cost savings” to compensate employees for >> the lost coverage, thus keeping the employees happy, and then pocketing the >> rest of the “enormous cost savings.” (Indeed, if employees grumble over >> the inconvenience or just the change, the employers can split some of the >> rest of the enormous cost savings with the employees -- a win-win >> proposition for employers and employees.) And, if Marty is right, this >> would be true for employers generally, *not* just religious employers. >> We should thus expect a large fraction of savvy employers to take advantage >> of this option, purely out of respect for Mammon quite regardless of God. >> >> >> >> But I wonder whether this is empirically likely to be true, given not >> just the nondeductibility of the tax, but also other factors, such as >> payroll taxes on the compensation payment to the employees. It’s not >> surprising that the Justice Department hasn’t made this argument, since the >> Administration has long argued (unless I’m mistaken) that large employers >> *won’t* drop employer-based health insurance. And the Congressional >> Budget Office, >> http://www.cbo.gov/sites/default/files/cbofiles/ftpdocs/121xx/doc12119/03-30-healthcarelegislation.pdf, >> likewise took the view that only a tiny percentage of employers would drop >> their health insurance, because “the legislation leaves in place >> substantial financial advantages for many people to receive insurance >> coverage through their employers, and it provides some new incentives for >> employers to offer insurance coverage to their employees.” >> >> >> >> Now of course that was in 2011, and perhaps the analysis today would be >> different. But the CBO’s estimates still give me pause. And if the CBO is >> right, and large employers generally would lose financially -- rather than >> gain from capturing some of the “enormous cost savings” -- by dropping >> health insurance and adequately compensating employees, then I would think >> Hobby Lobby and others would be in the same position. The mandate, even >> enforced as a tax, thus would be a substantial burden. >> >> >> >> Am I mistaken in this? Marty, do you have any pointers to studies that >> support your sense of the money flows on this, and contradict what I see as >> the CBO’s view? >> >> >> >> Eugene >> >> >> >> >> >
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