HEALTH CARE IMPLEMENTATION COSTS: REALITY CHECK

2 Most employers hope to avoid raising rates for their Group Health plans when new regulations under the Affordable Care Act take effect next January, according to a recent nationwide survey of more than 1,200 businesses by Willis Human Capital Practice. However, more than half of these businesses haven't calculated the cost of implementing these changes.

"Employers are still coming to terms with the impact of healthcare reform, and many employers still seem to function in a 'shock mode,'" says Jay Kirschbaum, Practice Leader of the Willis National Legal and Research Group. "Although few employers consciously manage their Group Medical benefits as a component of their total rewards package, survey responses indicate the beginning of an employer trend in this direction."

The study concluded that most businesses are either relying on inaccurate "perceptions of cost" in planning their responses to healthcare reform, or don't believe that the new rules will affect their Group Health program. For example, only 20% of surveyed employers plan to adjust other rewards (retirement, dental, vision, salaries, vacation, bonuses, and so forth) to offset the cost of ADA compliance.

The survey also found that:

  • More than one in three employers might shift health care costs to employees.
  • The percentage of employers willing to forego "grandfathered" status for their health plans has skyrocketed from only 13% in 2011 to 34% last year.
  • Most employers intend to "play" under the "pay or play" mandate, by offering plans that exceed the "minimum essential coverage" under the ACA, and adjust coverage and contributions later to manage expenses.
For informed advice on how to bring your company's plan into compliance with the ADA, while getting the maximum benefit from your health care dollar, please feel free to get in touch with us at any time.
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