Large Employers Shifting Healthcare Costs to Employees

There have been many people that have told me, “…I am not affected by Affordable Care Act(Obamcare), because I have health insurance from my job.”

However, the trend we are starting to see is that large employers are shifting Healthcare coast to employees. This will start becoming more poplar as large employees start to see how to reduce their cost. Here is great story by Abbey Rosenberg.

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Lately, there has been a trend among large employers who have reported considering shifting employees to private exchanges as a cost-mitigation strategy. However, preliminary results from a survey conducted by the National Business Coalition on Health and Benz Communications revealed that a majority of large employers surveyed rejected this idea. This article contains an overview of the preliminary results from the Inside Benefits Communication Survey.

Background on the Inside Benefits Communication Survey

The 2014 Inside Benefits Communication Survey was conducted by the National Business Coalition on Health and Benz Communications. The goal was to learn more about how companies are strategizing their benefits to comply withAffordable Care Act (ACA) compliance issues.

The survey polled 333 human resources and healthcare benefits professionals about their communications approaches, strategies, and results. While the survey spanned across the nation in a variety of industries, there were a significant number of respondents in the technology and service industries. In addition, respondents were located mainly in the Southeast and West regions of the United States.

Employers Are Not Looking to Private Exchanges

The preliminary results from the survey revealed that employers are rejecting the notion of moving their employees to a private exchange as a cost-mitigation strategy. Although this trend has been expressed in similar industry polls, 55 percent of the respondents reported that they will not stop sponsoring employee health insurance to sponsor coverage through a private exchange.

Other large employers did report interest in shifting employees to a private exchange:

  • Almost one-third (32 percent) of employers are considering moving to a private exchange within the next three to five years
  • Eight percent are planning a move to a private exchange within the next year
  • Five percent already use a private exchange to provide employee health benefits

Some Employers to Increase Employee Contributions

HR/benefits professionals were asked about whether they will maintain current benefit plans and coverage levels and whether costs would shift to employees. The results were that:

  • 40 percent will maintain current coverage levels without increasing employee costs
  • 32 percent will maintain current benefit and coverage levels, but will increase employee costs

Respondents were asked how their company will prepare to comply with the ACA “Cadillac tax” in 2018. The Cadillac tax is an excise tax on high cost health insurance plans offered by employers The results were as follows:

  • 26 percent plan to maintain current benefit plans and coverage levels without increasing employee costs
  • Almost 20 percent plan to maintain benefit levels, but will increase employee costs
  • 15 percent will reduce plan benefit and coverage levels while still increasing employee costs

Read the Inside Benefits Communication Survey from the National Business Coalition on Health and Benz Communications.