By Max Mihelich
Mar. 1, 2013
Considering the combined price of tough penalties and other financial costs to do away with health care plans, an overwhelming majority of employers say they plan to keep offering health benefits, according to a new survey.
The study, released Feb. 28 by Lincolnshire, Illinois-based HR consultancy Aon Hewitt, found that only 6 percent of large and midsized companies intended to terminate their health plans within the next three to five years.
Starting in 2014, the Patient Protection and Affordable Care Act will require employers with at least 50 employees to offer health insurance plans. Those that don’t will be liable to pay a non-tax-deductible penalty of $2,000 for each employee. And to remain competitive, many employers not offering health benefits would likely have to start increasing their employees’ salaries in order to offset the price they would have to pay to purchase their own coverage, according to the survey.
Many employers are considering implementing design changes to their health benefits and the way they’re offered, the survey shows.
During the next three to five years, 37 percent of employers plan to offer what Aon Hewitt has labeled a “house money/house rules approach,” which means employers may offer reduced premiums to employees who take health risk questionnaires or biometric screenings. Others may offer to pay employee prescription copayments for those who demonstrate they’re following doctor’s orders on chronic health conditions, according to Aon Hewitt.
Additionally, during the next three to five years, 28 percent of employers expect to move to private health insurance exchanges. Under this approach, employees would receive credit to purchase coverage through a private insurer.
Some employers have already started offering employees and retirees insurance through private exchanges. Last year, Aon Hewitt launched an exchange in which 100,000 employees from varying companies participate.
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