Wednesday, August 24, 2011

Another Survey Documents Rising Costs — and Employers Dropping Coverage

The HR firm Towers Watson today released a survey of large employers regarding health coverage.  Once again the results show that Obamacare is NOT following through on the promise to reduce costs – but IS encouraging employers to think about dropping their insurance offerings:

Higher Costs:  Overall plan costs are projected to rise at a 5.9% rate in 2012, well above the rate of inflation.

Lose Your Plan Now:  Seven out of 10 (70%) employers expect to lose grandfathered health status in 2012 – meaning employees will lose their current health plan, and employers will be subject to a blizzard of new regulations and mandates under Obamacare.

Lose Your Plan Later:  Nearly three in ten employers (29%) are unsure whether or not they will continue offering coverage to their current workers thanks to Obamacare.  More than half (54%) of employers currently offering coverage to retirees plan to drop that coverage.

Higher Premiums Now:   A majority of firms plan to raise the employee share of premium contributions in 2012 by at least one percentage point (66%) – with 20% planning to raise single-only coverage premiums by more than 5%, and 29% planning to raise family coverage premiums by more than 5%.  Despite candidate Obama’s repeated promises to CUT premiums for all Americans by an average $2,500 per household, only 1% of firms plan to decrease the employee share of premium contributions.

Higher Premiums Later:  Thanks to Obamacare, nearly half (47%) of employers plan to “substantially reduce the health care benefit value of active employees,” in 2014 and 2015, and an even greater percentage (57%) plan to “reduce employee contributions for lower-paid workers.”  (That is, of course, if those employers are even offering coverage at all by that point.)

Today’s survey once again documents how Obamacare has failed to live up to its promises – and continues to serve as a drag on American businesses and families.