San Antonio based Bill Miller Barbecue is one of a growing number of American companies which have opted for a new type of bare bones insurance coverage called a 'skinny plan' to meet the mandates of Obamacare, 1200 WOAI news reports.
"It only covers preventative care and not the critical things like surgery or a hospital stay or the things that would really be high dollar items for them," said Wendy Kowalik, President of the San Antonio financial management firm Predico Partners.
The Bill Miller plan, like most 'skinny plans' being rolled out mainly by companies in the labor intensive service sector, will cost an employee about $50 a month, which Kowalik says is still a large expense for a worker who is making near minimum wage.
"That's almost five percent of the income of someone who is making $8.50 an hour," she said. "That is something that they more than likely can't afford even today."
And Kowalik says the emergence of the 'skinny plan' demonstrates another basic problem with Obamacare. She says young, healthy employees who don't anticipate needing expensive procedures will stay on the company plan. But she says other workers who anticipate major health care costs will turn to the public 'insurance exchanges' for coverage.
"What you are going to find that it is only the sick people who will go on it, which is going to cause costs to skyrocket," she said.
The way insurance works is that everybody is supposed to be thrown together into a pool, and those who are young and healthy and don't need coverage subsidize those who have major medical costs. But Kowalik points out that when healthy people stay on the 'skinny plans' while the sick go to the exchange, that will burden the exchanges with costs without giving them the benefits of the contributions of those who are healthy, leaving the plan out of balance and leading to massive costs.
But companies say the 'skinny plan' is their only alternative to layoffs, massive costs which would damage the company's ability to remain profitable, or cutting all employees to under 30 hours a week, meaning that they would not be eligible for any company-provided health insurance under Obamacare.