Study: Employers plan health care changes
Most mid-size to large companies Towers Watson recently surveyed plan to keep offering health insurance.
According to the global professional services company's 2013 Health Care Changes Ahead Survey, 98 percent of the companies plan to retain their active medical plans for 2014 and 2015. However, more than 60 percent believe they will trigger the "Cadillac plan" excise tax in 2018 if they don't make adjustments to their current benefit strategy, and nearly 40 percent report they plan to change their plan designs for 2014 to combat the increase in employee health care costs and avoid the excise tax.
"In addition to emphasizing employee wellness and health improvement approaches, employers are looking to increase their use of supply-side strategies and aggressive vendor management techniques," the study says. "For 2015 or 2016, they are considering providing outcome-based incentives (49%), offering a benefit differential for use of high-performance networks (47%) and using value-based benefit designs (40%). Employers will also be focused on reducing coverage subsidies for spouses and dependents, as well as implementing spousal coverage exclusions or spousal premium surcharges when other health coverage is available."
The survey also found that employers are considering looking to private exchanges or the public marketplaces as potential delivery channels for their plans. Private exchanges have an edge, with 58 percent of employers expecting them to be a viable alternative to their current arrangements, with less than 30 percent of employers thinking the same of the public marketplaces.
About a quarter of employers say they are somewhat or very likely to discontinue their plans for post-65 retirees in 2014. That percentage increases to 44 percent in 2015. For pre-65 retirees, the percentages are 10 in 2014 and 38 in 2015.
Less change is expected for part-time employees. Only 11 of the employers are considering changes to their total rewards mix or design for part-time employees. Many part-time employees are likely to seek coverage through public exchanges, the survey said.