NEW YORK U.S. aluminum companies are taking a hard look at President Obamas health-care reform following his re-election.
Executives will meet in upcoming weeks to discuss the impact, one producer source said. "We talked about it when it was first introduced but not in the last (few) days now that it looks like its here to stay. Im sure well discuss it within the next two months."
"Weve sealed our fate there, so to speak. Were going to go back and look at exactly what were dealing with," an extruder source said. "Im concerned. Will companies continue to pay for health care? Or will the government? These are questions we need answered."
Producers are keen to know what the health-care plans will look like, what the benefits are and how they will be implemented, with most sources telling AMM that they believe companies health-care costs will increase.
"We got some advice about four or five weeks ago. The impact of the reform will increase our health-care costs by 29 percent as its implemented through 2014," a second producer source said. "That feedback came directly from our (insurance) carrier."
Companies have the option to drop coverage, but some say they will keep offering health-care benefits in order to attract employees.
"We could drop the coverage if we wanted to but I dont think we will. We still have to offer something. Smaller companies might be forced to drop coverage, though," the first producer source said. "It would give me the opportunity to save money, sure, but it would also hurt my employees. Right now, they have a better policy than going through the state."
In addition to increasing costs, implementing such a scheme will undoubtedly take years, which could hurt productivity, another extruder source said. "On a day-to-day basis, Id rather be selling extrusions. Having a change like this requires commitment, energy and resources on our part thats not going to help our business."
Still, not everyone in the industry is opposed to Obamacare. A service center source said that the reform eventually will lower companies health-care costs.
"Im hoping that through Obamacare, rates for mid-size companies will go down as competition increases for our (insurance) business," he said. "Right now, in Alabama theres only one registered provider. But under Obamacare, the whole country opens up. Its clear that in order for insurance companies to maintain their market shares or even grow, theyre going to have to get more competitive. And the gravy days of no competition and raising rates will disappear."
He added, "Besides addressing the uninsured, the whole master plan is to bring down the cost for everything."