POLITICS
01/22/2015 12:30 pm ET Updated Jan 22, 2015

Elizabeth Warren Explains How Anti-Obamacare Bill Is Corporate Welfare

WASHINGTON -- A bill that would redefine a full-time work week under the Affordable Care Act as 40 hours instead of 30 actually amounts to a break for corporations, Sen. Elizabeth Warren (D-Mass.) argued in a hearing Thursday.

Under the legislation, businesses would be obligated to provide health care only to employees who work 40 hours a week or more, rather than 30. Republicans and some Democrats have backed the bill, saying the current 30-hour standard offers an incentive to cut workers' hours to get around Obamacare's requirement that full-time employees receive insurance. Supporters have pointed to numerous instances of employers -- from public schools to restaurant businesses -- doing exactly that.

Yet those backers have downplayed broader economic indicators suggesting that businesses have not, in fact, shifted workers to part-time in order to avoid the Obamacare rule. In fact, part-time work has fallen since the law was passed.

And a Congressional Budget Office report released earlier this month found that if the standard were shifted from 30 hours a week to 40, many more workers would be at risk of having their hours cut. This is because a much larger portion of the workforce -- about half -- works around 40 hours per week. By contrast, fewer than one in 10 employees work around 30 hours per week.

According to the CBO, the proposed legislation would increase the incentive to cut workers' hours from 40 a week to just below. As a result, up to 1 million workers could lose their employer-backed insurance -- and many of those people would need to shift to tax-subsidized Obamacare. All told, the move would add $53.8 billion to the deficit, CBO said.

Warren said that the bill effectively shifts the burden away from companies and onto taxpayers.

"This bill is corporate welfare," Warren said at a hearing held by the Senate Committee on Health, Education, Labor & Pensions. "Big corporations would get to cut health benefits for millions of workers, and push people out of their employer insurance plans. Some of those people will lose their health insurance all together. Others would be pushed onto federal programs, expanding the reach of Obamacare, and taxpayers would get stuck with the tab."

"I'm against adding $53 billion to the deficit so that corporations can push their costs and responsibilities onto the government," Warren added.

Doug Holtz-Eakin, an economist who testified at Thursday's hearing for Republicans and once led the CBO, said his former agency's numbers were crafted "in good faith." But he disputed CBO's findings, suggesting that companies already providing health insurance would not have incentive to cut hours from 40 to 39.

"We've come down on different places, I think it's open to question," Holtz-Eakin said.

But Sen. Al Franken (D-Minn.) noted that Holtz-Eakin is now the president of an organization called the American Action Forum, which is part of a coalition of groups dedicated to repealing Obamacare.

"I'm not sure that when you're aligned with a group that has a banner that says 'Help us stop Obamacare,' that your estimates are necessarily in good faith," Franken said.

Michael McAuliff covers Congress and politics for The Huffington Post. Talk to him on Facebook.

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