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Employers pull back on employee health benefits, study finds

 
Employers continue to be the biggest providers of health coverage in theEmployee Health Benefits United States, but that rate had been steadily slipping in the private sector, a new study by the Employee Benefit Research Institute found.

Some people point to President Barack Obama’s health care law as the driving force behind the change, but the EBRI report suggests that the shift has been underway for years.

Among their key findings in their report:
  • 70 percent of workers had access to health insurance through their jobs in 2010, a rate that dropped to about 67.5 percent by 2010.
  • About 57 percent of workers got health insurance from their employers in 2010, down about 3 percentage points since 1997.
  • Between 1997 and 2010, the percentage of workers who declined coverage because of cost increased from 23.2 percent to 29.1 percent. In 2010, two-thirds reported that they declined coverage because they had other coverage, down from 78.9 percent in 1997.
Even if the the PPACA is overturned, experts interviewed by the Associated Press predict that employers will continue to look for cost-saving features on their own, including exchanges and wellness programs.  "Employers had been the major force driving health care change in this country up until the passage of health reform," said Tom Billet, a senior benefits consultant with Towers Watson. "If Obamacare disappears ... we go back to square one. We still have a major problem in this country with very expensive health care."

Among the trends that the Associated Press article identified:

  • Workers will bear more of their medical costs as employer-sponsored coverage shifts to plans with higher deductibles. High-deductible plans will become more common, coupled with tax-free accounts for routine medical expenses.
  • Some companies will continue to offer coverage for adult children until they turn 26. Others will drop that option.
  • Some workers will pick their health plans from a private insurance exchange, using ixed payments from their employers to choose from multiple levels of coverage. The richer the benefits desired, the more the employee will pay.
To this list, we would add the rise in voluntary benefits to that list of trends, as more employers look for ways to maintain and expand their benefits offerings right now in response to rising health care costs and the added complexities created by the Patient Protection and Affordable Care Act (PPACA). Products like Critical Illness Insurance can help protect against expenses that aren’t covered by high-deductible medical plans, for example.

What do you think will happen to employer-sponsored health care if the PPACA is overturned?

Winston Benefits is a HR solutions company that helps businesses automate and streamline their employee benefit programs. Custom designed and developed client specific solutions help enrich their total compensation and rewards programs while optimizing processes such as benefit communications, enrollment and administration.

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