Worried that President Joe Biden’s Covid vaccine mandate for private companies could cause a mass exodus of employees, business groups are pleading with the White House to delay the rule until after the holiday season.

White House officials at the Office of Management and Budget held dozens of meetings with labor unions, industry lobbyists and private individuals last week as the administration conducts its final review of the mandate, which will require businesses with 100 or more employees to ensure they are vaccinated against Covid or tested weekly for the virus. It is estimated to cover roughly two-thirds of the private sector workforce.

Business groups ask White House to delay Joe Biden Covid vaccine mandate until after the holidays

OMB officials have several meetings lined up Monday and Tuesday with groups representing dentists, trucking companies, staffing companies and realtors, among others.

The American Trucking Associations, which will meet with the OMB on Tuesday, warned the administration last week that many drivers will likely quit rather than get vaccinated, further disrupting the national supply chain at time when the industry is already short 80,000 drivers.

The trucking association estimates companies covered by the mandate could lose 37% of drivers through retirements, resignations and workers switching to smaller companies not covered by the requirements.

“Now placing vaccination mandates on employers, which in turn force employees to be vaccinated, will create a workforce crisis for our industry and the communities, families and businesses we serve,” Chris Spear, the association’s president and CEO, wrote in a letter to the OMB last Thursday.

Retailers are also particularly concerned the mandate could trigger a spike in resignations that would exacerbate staffing problems at businesses already short on people, said Evan Armstrong, a lobbyist at the Retail Industry Leaders Association.

“It has been a hectic holiday season already, as you know, with supply chain struggles,” Armstrong told CNBC after a meeting with White House officials last Monday. “This is a difficult policy to implement. It would be even more difficult during the holiday season.”

Thirty percent of unvaccinated workers said they would leave their jobs rather than comply with a vaccine or testing mandate, according to a KFF poll published last month. Goldman Sachs, in an analysis published in September, said the mandate could hurt the already tight labor market. However, it said survey responses are often exaggerated and not as many people will actually quit.

The Occupational Safety and Health Administration delivered its final rule to the OMB on Oct. 12, and the mandate is expected to take effect soon after the agency completes its review.

The National Retail Federation, the trucking association and the retail leaders group are asking White House officials to give businesses 90 days to comply with the mandate, delaying implementation until late January at the earliest.

The Business Roundtable told CNBC it supports the White House’s vaccination efforts, but the administration “should allow the time necessary for employers to comply, and that includes taking into account employee retention issues, supply chain challenges and the upcoming holiday season.”

The U.S. Chamber of Commerce, which met with the OMB on Oct. 15, also asked the administration to delay implementing the rule until after the holiday season. Officials at the OMB declined to comment on the implementation period.

However, former officials at OSHA, which will enforce the mandate, told CNBC that businesses will likely have some time to implement the rules.

Jordan Barab, deputy assistant secretary of OSHA during the Obama administration, said the administration will probably give businesses about 10 weeks, as they did for federal contractors, until employees have to be fully vaccinated.

However, the compliance date could come sooner for weekly testing, he said.

“OSHA has always had provisions where its required equipment, for example, that may be in short supply to suspend enforcement if an employer can show its made a good faith effort to procure that equipment,” Barab said. “They may make a relatively early date for weekly testing but also provide some additional time in case supplies are not adequate.”

The National Association of Manufacturers, in a letter to the OMB and OSHA head James Frederick last Monday, asked the administration to exempt businesses from the requirements if they have already implemented companywide mandates, or achieved a certain level of vaccination among employees through voluntary programs if certified by a local public health agency.

Robyn Boerstling, a top lobbyist for the manufacturers’ group, called the federal requirements “redundant and costly” for companies that already support vaccination among their staff. Boerstling also expressed concern that businesses with barely more than 100 employees could lose valuable people to competitors who are not covered by the mandate.

“A realistic implementation period can allow for workforce planning that is necessary given the acute skilled worker shortage and ongoing supply chain challenges by supporting the need to keep manufacturing open and operational,” Boerstling wrote in the letter to the administration last Monday.

The American Trucking Associations, in its letter last week, also asked the administration to consider exempting truckers from the mandate, arguing that drivers are similar to remote workers because they do not interact with another employee for days or weeks at a time.

Industry lobbyists have also raised concerns about the cost of testing, and who will cover those costs. The Retail Industry Leaders Association believes employees who choose not to get vaccinated should pay for their weekly testing.

“If folks are allowed to refuse vaccination, and the employer takes testing obligations from a cost standpoint, then there’s no real motivation for those employees to get the vaccine,” Armstrong said. With an estimated 4 million unvaccinated retail workers, testing costs will also add up quickly, he said.

However, Barab said OSHA generally requires employers to cover the cost of equipment and procedures called for under its rules throughout the agency’s 50-year history.

Industry concerns about the impact of Biden’s vaccine mandate on employment come after a record 4.3 million workers quit their jobs in August, the highest level of turnover in 20 years. The retail industry was particularly hard hit, with 721,000 workers leaving their positions.

Goldman Sachs says the mandate would actually boost employment by reducing Covid transmission and mitigating health risks that have been a drag on labor force participation, encouraging many of the 5 million workers who have left the job market since the pandemic to return.

Global supply chains are also strained amid a surge in pandemic-related demand for durable goods, factory shutdowns in places like China and Vietnam, and a shortage of truck drivers and skilled longshoremen on the West Coast.

The White House admits there is little it can do to tackle the macro issues like increased demand and foreign factory operations. But it has recently taken some steps to help, like brokering a deal to keep major West Coast ports open 24 hours a day, seven days a week.

“We’re already having supply chain issues; we’re already having workforce shortage issues,” Ed Egee, a top lobbyist at the National Retail Federation, told CNBC after the group’s meeting with the OMB last Tuesday. “This mandate cannot be implemented in 2021 without having serious repercussions on the American economy.”

Joe Biden vaccine rules worry rural hospitals about potential strain

Throughout the COVID-19 pandemic, short-staffed rural hospitals have been stretched to their limits.

Some have cut back, delayed or eliminated services such as elective surgeries, labor and delivery, and other inpatient care. Nurses and other health care employees have worked double shifts, and many rural hospitals have had to create makeshift intensive care units.

In the broadest sense, President Joe Biden’s vaccine requirement for the more than 17 million U.S. health care workers will alleviate the strain on all health centers and clinics by boosting the country’s overall vaccination rate — and by reducing the number of health care workers who are forced to take sick leave because they contract COVID-19. Big-city hospitals have brushed aside some workers’ protests and lawsuits, implementing vaccine mandates without a significant effect on staffing or patient care. About 41% of U.S. hospitals already have a vaccine mandate, according to the American Hospital Association.

But the story may be more complicated in rural America, where resistance to the vaccine remains strongest. Some rural hospital leaders worry the vaccine mandate will exacerbate a labor shortage that was profound even before the pandemic. There are predictions that some hospitals will have to close their doors.

“I’ve talked with administrators of hospitals that have estimated anywhere from 3% to as much as 20% of their workforce may have to quit their jobs if they’re required to have the vaccine as a condition of their employment,” said Brock Slabach, chief operations officer for the National Rural Health Association, a nonprofit that represents rural hospitals and clinics as well as doctors, nurses and administrators.

“In a rural hospital, that could be two, maybe three nurses,” Slabach said, “which could cripple their ability to meet the demands of patient care.”

As of early October, nearly 43% of the rural population was fully vaccinated, compared with 53% of the U.S. population, according to an analysis of federal Centers for Disease Control and Prevention data by the Daily Yonder.

To get more jabs in arms, the Biden administration announced last month that it will require COVID-19 vaccinations for workers in most health care settings that receive Medicare or Medicaid reimbursement, including hospitals, dialysis facilities, ambulatory surgical settings and home health agencies. The federal Centers for Medicare and Medicaid Services hasn’t yet announced a deadline for workers to meet the requirement.

We have 75% of our staff vaccinated. … I, myself, am vaccinated and believe in the vaccine, but I have employees that don’t. So, what do you do? If I had to get rid of 25% of my employees, say 40 to 50 employees, that’s a huge number. It’ll be devastating.

Even before the federal requirement, at least 22 states plus the District of Columbia announced that state health care workers—or, in some cases, all health care workers—would need to be vaccinated or regularly tested, according to the nonprofit National Academy for State Health Policy.

But six states — Arkansas, Georgia, Indiana, Montana, Tennessee and Texas — have approved laws or have executive orders from their governors prohibiting vaccine mandates as a condition for employment.

Hospital leaders say the conflicting guidance makes it difficult to know how they should proceed, though experts assert that federal law will supersede any conflicting state law or executive order.

In Texas, for example, Republican Gov. Greg Abbott’s Oct. 11 executive order imposed fines on employers that mandate vaccinations for employees.

Jerry Jasper, the CEO of Brownfield Regional Medical Center in rural Terry County, Texas, said Abbott’s action puts hospitals such as his in a bind. On the one hand, forgoing a vaccination requirement might allow them to retain some vaccine-resistant health care workers. On the other hand, the federal government will deny federal funding to any hospitals that violate Biden’s vaccination order. Jasper currently has positions open for nurses and lab technicians, among others.

“It’s kind of a scary part to be walking in, especially if you’re a hospital, because President Biden’s actually saying if you don’t do the mandate, you’re not going to get Medicare or Medicaid funding. Then, you got our governor saying the total opposite,” Jasper said.

“We have 75% of our staff vaccinated. … I, myself, am vaccinated and believe in the vaccine, but I have employees that don’t. So, what do you do?” he said. “If I had to get rid of 25% of my employees, say 40 to 50 employees, that’s a huge number. It’ll be devastating.”

In some places, vaccine-related resignations and firings already are affecting patient care. For example, the Lewis County Health System in New York closed its maternity unit after staff resigned over the state’s vaccine mandate.

Dr. Randy Tobler, CEO and director of women’s services at Scotland County Hospital in rural Memphis, Missouri, said his hospital will abide by Biden’s mandate, but some staff members have told him they will quit rather than get vaccinated.

“We realize it will further erode our ability to adequately provide acute care for COVID-19, motor vehicle accidents, heart attacks and other kinds of problems,” Tobler told Stateline. “While we actively encourage the staff to have a vaccine, we have to balance that against the risk of not being able to provide care to patients by not having enough staff in the hospital when patients present with acute illness.”

Tobler added that he’s talked to numerous staff members to educate them about vaccines and encourage them to get the shot. The key, he said, is showing respect and building trust.

“I’ve gotten a lot more people to decide to get vaccinated that way, as have most doctors … instead of being heavy handed,” Tobler said. “That’s just the way rural communities are: Things are done on trust, not on denigration and insults.”

As the most recent COVID-19 surge subsides, some rural hospital leaders are less worried about the effect of the vaccine mandate.

In Washington state, Democratic Gov. Jay Inslee in August issued an executive order requiring the state’s health care workers to be vaccinated by Oct. 18. In a survey conducted by the Washington State Hospital Association shortly before the deadline, hospitals reported that 88% of staff already were vaccinated.

There was a slightly lower rate in rural areas, but not a huge gap, said Jacqueline Barton True, vice president of advocacy and rural health at the association.

“There were a lot of rural hospitals that said, ‘I’m going to close. I’m not going to be able to stay open,’” Barton True said. “[But] the number of folks who said they were concerned about service disruptions, even within a week’s time, really shifted.

“On the other hand, if there’s a large surge in COVID cases again, like we’ve seen about a month ago, that could create additional strain on the system that we may not be able to absorb.”

Barton True said her association is “cautiously optimistic” that the vaccine mandate won’t cause any of the state’s 45 rural hospitals to close.

But Slabach, of the National Rural Health Association, argues there should be alternatives to vaccine mandates, such as weekly testing. He worries mandates will push more people out of a profession that already is losing workers. Earlier this month, the federal Bureau of Labor Statistics reported that while overall employment rose by 194,000 in September, the health care sector lost 18,000 jobs.

Health care has lost 524,000 workers since last year, with nursing and residential care facilities accounting for more than half of the loss, according to the report.

Jasper, of the Brownfield Regional Medical Center in Texas, said he’s concerned about the future.

“It’s worrying about if you got enough staff to take care of the patient. It’s worrying about how you’re going to take care of the financial responsibility for the hospital and keep it open,” Jasper said.

“It’s just a big juggling act at this point. And it’s hard to know what’s the right direction and what’s best.”