Over Four Years Later, Most Companies Still Do Not Feel Prepared For ACA Changes

It has been more than four years since the Patient Protection and Affordable Care Act (ACA) became law, and most companies still do not feel prepared to comply with the employer mandate, excise tax, and other changes on the horizon, according to recent research from Aflac. The 2014 Aflac WorkForces Report found that while 40 percent of companies said that they understand the ACA “extremely” or “very” well, the number drops for businesses with less than 100 employees: only 31 percent of employers with 25 to 49 employees said they understand the ACA “extremely” or “very” well, and even less—27 percent—of those with under 25 employees feel “extremely” or “very” confident in their understanding of the ACA reforms.

Controlling health costs. Employers are still very concerned about controlling rising health care costs. The survey found that 49 percent of employers identified controlling costs as their primary objective. In 2013, employers took significant steps to contain costs, such as: hiring independent contractors or consultants (39 percent); eliminating or reducing employee benefits offerings (22 percent); and converting workers from full-time to part-time (21 percent).

In addition, 56 percent of employers increased employees’ copayments and/or shares of premium in 2013, and 59 percent plan to do the same before the end of 2014. Nineteen percent of companies moved away from traditional major medical insurance in 2013 and instead implemented health savings accounts (HSAs) with high-deductible health plans (HDHPs).

Communication. Employers should concentrate on communicating benefits changes and the ACA’s impact on employee benefits to employees, Aflac noted. However, the survey found that many employers are not effectively using communication to manage change. When asked to assess their companies’ communications efforts, only 9 percent of employees believe their human resources departments have communicated extremely effectively about the ACA and subsequent changes to their benefits packages, and only 3 percent of employees completely agree their employers have prepared them well for the impact of the ACA.

The study was conducted in January 2014 and contains responses from 1,856 employers and 5,209 employees. For more information, visit http://workforces.aflac.com/download/pdf/overview/2014_Executive_Summary.pdf.

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