Majority Of Employers Will Offer Health Coverage For The Foreseeable Future

from Spencer’s Benefits Reports: Following the U.S. Supreme Court decision on the Patient Protection and Affordable Care Act (ACA), 88 percent of employers have affirmed their commitment to offer health care benefits to their active employees for the foreseeable future, according to a survey from Towers Watson. This commitment (up 17 percentage points from 2011) comes despite a projected 2013 per employee health care cost of $11,507, an increase of 5.3 percent from 2012, the 2012 Towers Watson Health Care Changes Ahead Survey noted.

“While the most significant changes mandated by health care reform will not occur until 2014, it is essential that companies develop a strategic response and prepare for these changes well in advance of then,” said Ron Fontanetta, senior health care consulting leader at Towers Watson. “These changes will have a profound impact on the way health care is delivered and how many individuals acquire health insurance, most notably retirees.”

Although the rate of health care cost increases has slowed (5.3 percent projected for 2013 compared with an expected 5.9 percent in 2012), 58 percent of employers expect they will trigger the health care reform excise tax in 2018 if they do not make changes to their current benefit strategy. As a result, 83 percent of employers are planning to take steps to control their costs to avoid the tax. Of the $11,507 total cost, employers paid, on average, $8,911 per employee, while employees paid $2,596.

The actions and programs that companies are planning or considering to reduce costs include changing plan options (63 percent), significantly reducing subsidization of coverage for spouses and dependents (38 percent), and using spousal waivers or surcharges (29 percent). Additionally, some employers will pass along a greater percentage of costs to employees. Thirteen percent plan to increase their employees’ share of health care of premiums in 2013 by five percentage points or more, while 42 percent plan to increase employees’ share by one to five percentage points.

The survey contains responses from 440 midsize companies. For more information, visit http://www.towerswatson.com.