Few Mid-Tier Employers Plan to Eliminate Healthcare, According to Survey


Despite concern over rising costs, few small to mid-size companies plan to eliminate employee healthcare coverage in the next year, according to a survey of more than 400 executives by TAG Employer Services. Asked if they agree or disagree with the statement…We will continue to offer healthcare coverage to our workers…68 percent of the respondents strongly agree and 28 percent somewhat agree. Only 4 percent somewhat or strongly disagree.

“For the great majority of organizations we surveyed, the Affordable Care Act is not an issue since they employ fewer than 50 workers and aren’t affected by the law’s requirements,” said Jack Biltis, Chief Executive Officer for TAG, an administrative services organization. “Nevertheless, for most small employers healthcare coverage isn’t expendable. At least four out of five mid-tier companies offer some type of insurance. Not only is it good business, healthcare coverage is also essential for companies to hold their own in the competition for talent.”

While benefits used to be far down a prospective employee’s list of questions about the hiring company, Biltis observed, benefits are now the second most asked question during an interview, surpassing even career advancement questions. “Companies with fewer than 100 employees have to have a clear benefits strategy since they usually Can’t afford the generous benefit programs offered by larger organizations.”

Even with their continued healthcare commitment mid-tier enterprises are concerned about controlling the costs, according to the findings. When asked, “In terms of employee healthcare coverage, which of the following do you expect to present the greatest challenge in the year ahead?” participants responded:

• Keeping healthcare costs under control: 77 percent;
• Helping employees make the best choice: 10 percent;
• Avoiding government penalties related to healthcare: 8 percent; and
• Avoiding confusion: 5 percent.

“Employers are wrestling with cost control and have shifted part of the burden onto employees, a long-term trend,” observed Biltis. “What they want is a program that’s cost-effective and meets the particular needs of their workers, needs that vary depending on the demographics, the industry and other factors. As a rule, employers aren’t looking for a “cheap” solution and with all the flux in the healthcare marketplace they expect to hold the course, at least over the next year or two.”
The survey of 423 executives at mid-tier organizations was conducted between November 4 and December 5, 2014.

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