Skip to main content

Will Employers Eliminate Health Coverage In 2014?

'Yes' says the smart money.   From AIS's Health Reform Week;
"Health insurance reform mandates already in effect are having a major cost impact on midsized employers across the U.S., according to a new actuarial modeling analysis by Lockton Benefit Group. On average, employers with 2,000 to 10,000 employees tacked another 2.5% onto their health insurance costs since mandates went into effect last September — primarily due to reform requirements extending dependent coverage to age 26 and eliminating lifetime and raising annual coverage limits, the firm says. Moreover, costs related to these mandates are just the tip of the iceberg — to the point where many employers could consider termination of their plans in 2014."

[...]

"Employers deciding to eliminate health plan coverage in 2014 will save an average of about 44% off their current health care spending, according to Lockton’s actuarial modeling. Thus, an employer spending $10 million today would spend $4.4 million to jettison its plan and pay the relatively smaller financial penalty, Fensholt explains. He notes that the employer doesn’t save the entire $10 million because of the penalty, which is nondeductible, as well as the lost tax deduction on its current spending, and lost Social Security tax savings on employee pretax premium contributions.
More:

Two Views Of the Future Of Employer Sponsored Coverage.  Booz&Co calls the demise of employer-sponsored coverage "greatly exaggerated."  They're wrong.

What would happen if employers walked away from health coverage? Kaiser Health News calls it "..a bailout of epic proportions."  I'll take that bet.


Labels:

Comments

Post a Comment

Popular posts from this blog

Michael Porter On Health Care Reform

Michael Porter, writing in the New England Journal of Medicine, proposes "A Strategy For Health Care Reform - Toward A Value-Based System." His proposals are fundamental, lucid and right-on, meaning they're sure to be opposed by some parties to the debate, the so-called "Yes, but..." crowd. Most important, in my opinion, is this: "... electronic medical records will enable value improvement, but only if they support integrated care and outcome measurement. Simply automating current delivery practices will be a hugely expensive exercise in futility. Among our highest near-term priorities is to finalize and then continuously update health information technology (HIT) standards that include precise data definitions (for diagnoses and treatments, for example), an architecture for aggregating data for each patient over time and across providers, and protocols for seamless communication among systems. "Finally, consumers must become much mor...
Post a Comment
Read more

gapingvoid cartoon #378

Buy your own, here.
Post a Comment
Read more

"An Affordable Fix For Modernizing Medical Records"

...from the Veterans Health Administration and Midland (TX) Memorial Hospital. I know enough about my own strengths and weaknesses to know that I'm no IT expert. But I am acutely interested in examples of people and teams thinking differently to solve long-standing, intractable problems and, for better or worse, there are lots of those to be found in the IT realm. Yesterday, it was a story about a team adding iPhone portability to MEDITECH functionality, delivering to harried physicians better access to clinical data and more productive hours in every work day. (Wow. Apple in the boardroom AND the physician lounge. Has to be an IT traditionalist's worst nightmare. But I digress...) Today, the Wall Street Journal features a story about Midland (TX) Memorial Hospital finding an affordable, open-source alternative to proprietary EMR systems : "In the push to digitize America's hospitals, Midland Memorial faced an all-too-common dilemma: a crying need for information ...
3 comments
Read more