A report by McKinsey & Co. has found that 30% of employers are likely to stop offering workers health insurance after the bulk of the Obama administration’s health overhaul takes effect in 2014.
The findings come as a growing number of employers are seeking waivers from an early provision in the overhaul that requires them to enrich their benefits this year. At the end of April, the administration had granted 1,372 employers, unions and insurance companies one-year exemptions from the law’s requirement that they not cap annual benefit payouts below $750,000 per person a year.
But the law doesn’t allow for such waivers starting in 2014, leaving all those entities—and other employers whose plans don’t meet a slate of new requirements—to change their offerings or drop coverage.
Previous research has suggested the number of employers who opt to drop coverage altogether in 2014 would be minimal.
But the McKinsey study predicts a more dramatic shift from employer-sponsored health plans once the new marketplace takes effect. Starting in 2014, all but the smallest employers will be required to provide insurance or pay a fine, while most Americans will have to carry coverage or pay a different fine. Lower earners will get subsidies to help them pay for plans.
In surveying 1,300 employers earlier this year, McKinsey found that 30% said they would “definitely or probably” stop offering employer coverage in the years after 2014. That figure increased to more than 50% among employers with a high awareness of the overhaul law.
via Many Employers May Drop Health Coverage After Overhaul, Report Says – WSJ.com.
Ugh!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!
Ugh indeed!
As a previous employer, it was already murder trying to provide this benefit for our employees. And it was an important thing to do in order to attract and retain the best employees. The new law is making it difficult for all small and medium businesses, impossible for many, and will close down some. Obama-care is anti-business.
Ferd I am not happy about it either, never was from the get go. I remember you and I discussing before how best to solve America’s health care crisis and you said something along the lines why don’t we just adopt another country’s system that is working. That’s what I thought we should have done all along — universal health care like Canada or France which is rated one of the highest. The number of uninsured continues to go up, up up and I don’t see that changing.
Thank God I live in Canada where we have universal health care, however it does not cover the cost of drugs to the average person unless you are either s senior or a welfare person than they are covered, also they only cover hospital cost in a ward setting however most hospitals only have two beds to a room, so you would be covered in semi private…employer insurance covers drugs for those who work and and have a health plan. also every province is different on how they administer universal health care, so I can only speak from Ontario where if you are a working person you pay $900.00 per year for our coverage… The private part of our employee health care covers drugs, physiotherapy, message etc. if ordered by a doctor, if you do not have any private insurance with your employer you have to go to the hospital for your treatments which is free on an outpatient basis, while in hospital for a knee replacement etc. the govt. covers it while you are in hospital. however I have never heard of any of our citizens going bankrupt over medical bills, or services not given that is required. Oh BTW we are not covered for dental unless though your employer or private that you buy yourself.
In the US medical bills is the number one cause of bankruptcy and many of them have insurance! Now of course the financial and housing meltdown. At some point I think our country will eventually go to universal health care I only wish it was sooner than later. Thanks Mary Anne for always giving my readers your insight from Canada.
I agree, Mary-Anne. I learn from and appreciate your comments!