Obamacare is putting the agricultural industry in a tizzy.
Many contractors who provide farm labor and must now offer workers health insurance are complaining loudly about the cost in their already low-margin business.
Some are also concerned that the forms they must file with the federal government under the Affordable Care Act will bring immigration problems to the fore. About in the U.S. is undocumented.
鈥淭here鈥檚 definitely going to be some repercussions to it,鈥� said聽Jesse Sandoval, a farm labor contractor based in Stockton, California. 鈥淚 think there鈥檚 going to be some things that cannot be ignored.鈥�
Sandoval came to an educational conference for farm labor contractors 鈥� essentially staffing agencies for field workers 鈥� held at the San Joaquin County Agricultural Center in Stockton in the fall. Men with broad shoulders, wearing denim jackets and cowboy hats, sat in the audience, listening to lectures on a litany of laws and rules regulating their industry, including Obamacare鈥檚 employer mandate.
Last year, employers with 100 or more full-time employees had to offer health insurance to their workers or pay a stiff penalty. This year, employers with 50 to 99 full-time employees must comply.
Sandoval has about 100 workers on his payroll. When farmers need a crew to pick cherries, pumpkins or asparagus, they call him to send the workers. He has to offer them insurance this year, and he鈥檚 smarting over the price tag. At $300 a month per employee, he鈥檚 looking at a $30,000 monthly bill.
Sandoval said聽he can鈥檛 absorb the hit. 鈥淭he numbers aren鈥檛 there,鈥� he said. 鈥淢y margin is 10 percent, and I have to increase expenses 10 percent? Well, that doesn鈥檛 work.鈥�
So, like a lot of contractors, he鈥檚 passing the bill on to the farmers, who in turn are passing the bill on to the farm workers. Under the Affordable Care Act, employees can be asked to contribute 9.5 percent of their income toward health premiums.
But for farm workers who pick oranges or peaches for $10 an hour, that鈥檚 still too much. Agostin Garcia of Fresno, California, said聽the two contractors he works for near Fresno offered him insurance directly. But when he saw the price tag, he turned them both down.
鈥淔or me, I鈥檓 the only one in my house who works,鈥� he said. 鈥淭here鈥檚 five of us in the family. It just wouldn鈥檛 work. Either I pay for health insurance, or I pay the rent and utilities.鈥�
Garcia said聽only a fraction of his co-workers have signed up for coverage. He said聽when farm labor contractors hand out packets explaining the coverage, the page where workers reject it is right on top.
鈥淚 think they do it intentionally,鈥� Garcia said. 鈥淭hey comply with the laws by saying, 鈥業 offered.鈥� But they know that nobody鈥檚 going to accept it, they know that nobody鈥檚 going to pay those amounts.鈥�
The cost isn鈥檛 the only thing about Obamacare stressing people out in the ag industry. Some are worried about immigration problems. Employers have to new health care forms with the IRS for all their workers, whether or not they accept the insurance.
Attorney Kaya Bromley said聽this will make it harder for some contractors to turn a blind eye when workers give them fraudulent documents. 鈥淣ow that there鈥檚 more transparency because of all of the reporting, I think we鈥檙e going to have a lot more data on how many illegal or undocumented workers we have,鈥� she said.
Bromley said聽among the contractors for whom she consults, she has seen a range of quasi-legal and even illegal strategies to sidestep the health law.
鈥淚 have heard of employees who are choosing to opt out because they want to fly under the radar. I have also heard of employers who are urging the opt-out or at least encouraging it,鈥� she said. 鈥淎nd I warn all of them that they are going to be in big trouble.鈥�
Farm labor contractors say they鈥檙e stuck in a Catch-22. Technically, immigrants who are in the U.S. illegally aren鈥檛 eligible for Obamacare benefits. But employers can鈥檛 admit that any of their employees may be working illegally, so they have to offer the insurance or face stiff fines from the IRS, maybe even a discrimination claim.
鈥淚t鈥檚 huge. And no one鈥檚 talking about the enormity of it,鈥� Bromley said. 鈥淲hen it plays out, and the penalties start getting assessed, that鈥檚 when people will start having religion about it.鈥�
Golinda Vela Chavez helps run a contracting company in Salinas, California. For her, talk of Obamacare mainly brings up frustration with the country鈥檚 complicated immigration system. She said聽the U.S. doesn鈥檛 enforce the borders, but then doesn鈥檛 let people work. 鈥淎nd suddenly the employer is evil,鈥� she said.
Contractors wonder how they鈥檙e supposed to comply with the health care law when there鈥檚 still so much contradiction in the immigration system. 鈥淥ur government, all they do is talk about it, they don鈥檛 fix anything, they make everything worse,鈥� said聽Chavez.
The Affordable Care Act is a cookie cutter, she said, and the complexities of the farming industry just don鈥檛 fit.
This story is part of a partnership that includes , and Kaiser Health News.