5 Ways (you wish you could) Avoid the Obamacare Employee Health Insurance Mandate if You’re a Business Owner

THIS POST WAS ORIGINALLY ENTITLED “5 Ways to Avoid the Obamacare Employee Health Insurance Mandate if You’re a Business Owner” — since then, as more details about the law have become clear, it appears that there are not many, if any, loopholes around this train-wreck. So the blog post below is more for referencing what you maybe THINK you can do, but you can’t do. Enjoy!


I think the Obamacare mandate – the one that requires all businesses employing 50 or more people to provide healthcare benefits – is one of the most detrimental things Barack has done for small businesses.

In my opinion, if you’re a small business owner and you are subjected to this rule (and you don’t think you can get around it with one of my ideas suggested below), you should do the following: On all of your receipts/invoices, itemize Obamacare in the same way you would itemize sales tax. Show customers how much Obamacare costs them for every purchase. Show them that your business costs went up by whole percentages, and show them that you had no choice but to pass those costs on to them. Now, my liberal friends might think this to be childish political antics, but I disagree. I think it’s the dissemination of information. And the more information we have about what our government has done and is doing, the better. Right?

That said, I have a few ideas on how a small business might escape the Obamacare mandate. Well, five ideas, to be precise. Now, I’m no business expert, and I’m no legal expert (and now you’ve stopped reading). These are just the musings of a guy who has a little business experience, an interest in politics, a degree in philosophy, and an active mind. They might sound humorous, but I mean them to be serious. That said, this is not professional advice, though if you want to pay me for it, just email me and I’ll tell you where to send the check.

1)  Split your business in two. Most businesses do several different kinds of things so that there is a sensible way you could split the business. If your business currently has up to 98 employees, you could split your business in half (and create a new business), and split your workforce in half, and not be required to provide health insurance for any of them.

2)  Fire a few people. This will be the most effective for businesses with between 50 and 60 employees. The ones who aren’t fired would probably be guaranteed longevity in their jobs, since you’ll need them now more than ever, and you can even raise their salaries, as their workload and/or hours will increase by up to 20%. The ones who get fired should receive a nice severance package – a sort of “Thank You” gift for their contribution to your business, and for their termination, which will be saving you quite a bit of money. And if you use the opportunity to eliminate waste, automate more tasks, and streamline your operations, you may be able to give your employees a raise without significantly increasing their workloads. Everybody wins here. Except for Stanley, from The Office, after Michael Scott fake-fires him.

3)  Outsource a few tasks. I don’t mean outsourcing overseas; I mean outsource to another local company to downsize your labor force. This will probably only work if you’re just over the 50-employee mark, since only a limited amount of tasks can feasibly be outsourced. Obviously you’ll need to do some calculations here, but it’s very probable that by contracting some of your essential services, even if you have to pay another business a significantly higher rate than you were paying an employee to do those tasks, you’ll save a lot of money compared to having to supply healthcare for all your employees.

I picked this picture mainly because it was creepy. But it also made me think about businesses working together.

4)  Contract laborers. Consider encouraging some of your employees to go “freelance.” You could even offer them a parting bonus as some start-up capital. You could also offer to pay this person a little more for their contract work than you paid them as an employee, since “firing” them and then using them as a contractor will save you significant money. In the digital age, where many people are happy to work from home or to work odd hours, this could be a very viable option. Contract laborers aren’t considered employees, if they meet certain guidelines provided by the IRS, so you’ll have to make sure that’s all copacetic. (One of the main rules is that they’ll have to offer these same services to the general public – in other words, they have to actually be a contract worker.) This option is perhaps not the best one, but might be well-suited to certain businesses for, say, their marketing department or some other group of employees that could work independently of the business.

5)  Move some/all your employees to part-time. Part-time employees who work less than 30 hours a week are not counted toward your company’s employee total for the employee health care mandate. In other words, if you have 49 full-time employees and 25 part-time employees, you don’t have to provide health benefits. This site mentions that some businesses are already pursuing this option. Breitbart.com discusses this issue as well.

In a way, a perverse person could consider this last option to be “job creation.” For example: If your business requires 2,000 man-hours of labor per week, and you spread that across 50 employees at 40 hours per week apiece, you could reduce all of them to 29 hours per week, and hire 19 more employees, and, in theory, that would generate about the same amount of man-hours, and you can feel good about yourself and your coworker “Obamacare,” because, working together, you two created 19 jobs. Now that’s just good for the economy.

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3 Responses to 5 Ways (you wish you could) Avoid the Obamacare Employee Health Insurance Mandate if You’re a Business Owner

  1. M-Strizzle says:

    2 is no dice. And 5 is sketchy.

    2. The total number of employees is calculated as number of hours 50 employees would work, so as long as 2,000 hours are being worked, the rule applies.

    5. If you accidentally have one of those employees hit 30 hours, you have to provide all of them insurance or pay the fine. Also, how competitive can you hope to be if you don’t offer full time employment?

    Those two things being said, it sure is nice to see someone trying to get around the law within the law, rather than just saying that they will break it. Kudos, Sir.

  2. Haha, I knew this post would draw you out of your long cyber-silence! 😀
    I was (obviously) unaware of the 2,000 hour rule. That’s actually written into the bill?
    As for #5, I would argue that businesses such as those in food service can afford to have the majority of their payroll working 29 hours per week or less, with a maximum of 49 full-time employees.
    Yep, I’m all about those legal loopholes! Anybody who condones breaking a law is just asking for trouble. Or they’re founding our nation two and half centuries ago.

  3. Pingback: Obamacare Employer Mandate: Harder to avoid than we thought | The Ozark House

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