The proposed employer requirement in HR 3200 is essential for encouraging employers to continue offering health insurance. It levels the playing field between employers, reduces the incentive for employers to drop coverage and shift costs onto the public, and provides revenue to pay for the coverage expansion. The structure of the employer requirement will determine how much revenue is generated, how many people end up with employer-based insurance, and how health costs affect competition between employers. HR 3200 is the most effective in meeting the objectives of an employer requirement because it is easy to administer and requires firms to provide health coverage to their employees or pay a percent of payroll into the exchange. The average firm currently spends 10 percent of payroll on health care, and the proposed requirement would require employers to contribute at least 72.5 percent of the premium cost for the lowest cost individual plan that meets the minimum benefits requirements.
