Tracy Watts: The Reform Resource

By Sarah Sipek

Feb. 13, 2015

ACA 5 Year Aniversery

Tracy WattsTracy Watts
Senior Partner, National Leader for U.S. Health Care Reform

The first step after the legislation passed was to conduct a survey of employers to determine their impression of the law to determine how Mercer could best assist. The results were surprising. In 2010, employers’ biggest concern was the so-called “Cadillac” tax, which is not scheduled to go into effect until 2018. Complying with the excise tax has remained among employers’ top priorities. 

“I’ve been with Mercer for over 25 years, and never in my career were we focused on every move made around a law.

“The fact that we had a Supreme Court decision where pretty much everyone in the industry was glued to their TV screen waiting for the decision on the individual mandate and whether that would be upheld spoke to the gravity of the law. … Employers want to know about everything that happens, and they want to understand it. 

“In years past, the focus was on getting that percentage increase down to the budgeted number. All that employers could think about was next year’s enrollment. The ACA really forced employers to take a more long-term and strategic look at their benefits, which is a very positive thing. The law is forcing employers to consider how to best provide for their employees’ health care in the long term.

“We know from our survey data that as early as 2013 employers were already making changes to their benefits programs in anticipation of the excise tax in 2018, and I think that is definitely evidence that employers are taking a long-term view in how they are looking at their programs and how they are managing their benefits programs going forward. The excise tax continues to be a really big threat from the financial perspective regardless of the size of the company.

“We haven’t had a single word of guidance or anything from the regulators because they’ve been so busy dealing with the more immediate requirements.”

Sarah Sipek is a Workforce associate editor.

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