The number of employers that plan to continue providing their employees with health insurance has increased, according to a new survey conducted by the International Foundation of Employee Benefit Plans (IFEBP). The survey – 2013 Employer-Sponsored Health Care: ACA’s Impact – addresses how employers are responding to changes made by the Affordable Care Act (ACA). Most (94%) of the 966 benefits and human resource professionals, general and financial managers, and other company officials who responded to the March 2013 survey claimed that they “definitely” or “very likely” will continue providing health insurance coverage when many of ACA’s provisions take effect in 2014, up from 86% who responded similarly in 2012. A large majority (69%) responded that they would definitely continue providing coverage, up from the 46% who made the same claim in 2012. According to the survey, 91% of responding employers already offer medical benefits to employees who work more than 30 hours per week.
The survey examines a number of employer concerns presented by the ACA’s implementation, including changes in plan design and funding, grandfathered plan status, reactions to the future health insurance exchanges, and efforts to contain costs, among others issues. Key findings of the survey include the following:
- The number of employers that plan to keep their grandfathered health plan status continues to decline. The larger the employer, the more likely it is to maintain its grandfathered plan status. In 2013, only 27.3% of employers responded that their primary health plan is grandfathered, down from 34.3% in 2012, and 44.6% in 2011. Less than half of responding employers claimed that they expect to keep their plan’s grandfathered status two years from now.
- Approximately one in five employers (18%) claimed that they had increased their employees’ share of plan premiums to contain costs. Other cost-sharing methods include increasing in-network deductibles (14.9%), out-of-pocket limits (13.8%), or increasing copayments or coinsurance for primary care (12.7%). An additional 25.3% of employers stated that they intend to increase their employees’ share of premium costs over the next two years.
- About 40% of responding employers plan to increase their focus on wellness and other initiatives to counter the rising costs associated with ACA. The larger the employer, the more likely they are to offer wellness and prevention programs. A lower percentage of respondents claimed that they have adopted or expanded the use of financial incentives to encourage healthy behaviors (14.2%) and disease management programs (7.7%).
- A quarter of responding employers are increasing their emphasis on high-deductible health plans (HDHPs) with a health savings account (HSA) to cut costs.
- Most employers offer health plans that pass the minimum value (81%) and affordability tests (74.1%), as required under ACA to avoid the pay-or-play penalty.
- Nearly 17% of responding employers claimed that they are redesigning their primary health plan to avoid the high-cost premium plan excise tax that will take effect in 2018.
- Approximately 16% of employers responded that they have or plan to alter employee work hours to limit the number of employees who would be considered “full-time” under the ACA.