New survey reports detailing how U.S. employers are responding to health care reform were released by the Society for Human Resource Management on June 16, 2013, in conjunction with its Annual Conference & Exposition.
Part one, Health Care Reform—Challenges and Strategies, examines the difficulties that HR professionals are facing and the strategies they are using to handle the new regulations. Part two, Health Care Reform—Impact of Health Care Coverage and Costs, focuses on future health care coverage benefits and expected costs.
In addition, a two-page summary of the survey findings is presented in SHRM Research Spotlight: Health Care Reform—Challenges and Costs.
The research was conducted in May 2013, using a randomly selected sample of SHRM members. The Society received 818 responses, half from members with the job function of benefits and compensation and half with the job title of HR manager or higher.
Increased Costs, Cost-Sharing Expected
A large majority of those surveyed (84 percent) expect their health care coverage costs to increase in 2014. Among these respondents, more than half (55 percent) predicted an increase of up to 10 percent, 19 percent forecast a 10 percent to 15 percent increase, and one-quarter (26 percent) expected an increase of 16 percent or more. Generally, small organizations expect greater jumps in costs.
Most responding organizations (83 percent) are likely or highly likely to pass on higher costs to their employees.
When asked what actions their companies are taking as a result of the Patient Protection and Affordable Care Act (PPACA), respondents mentioned the following:
- HR staff education. Nearly three-quarters of organizations are educating HR staff members through classes (74 percent) or working with legal/benefits counsel (73 percent) to help them understand the health care law.
- Redesigned plans. More than one-half are working with their benefits provider to design a compliant health care plan for 2014 (61 percent) or analyzing the short-term financial impact of the law (60 percent).
- Alternative plan options. More than one-half (56 percent) already offer (37 percent) or plan to offer (19 percent) their employees alternative, lower-premium coverage, including high-deductible plans with health savings accounts or health reimbursement arrangements.
- Self-insurance. Just over half of organizations (52 percent) have fully insured medical benefits. Larger businesses are more likely to be self-insured, as are publicly owned, for-profit companies.
- Spousal coverage. Thirteen percent of organizations have provisions to limit coverage for employees' working spouses, such as applying surcharges or exclusions, and 9 percent plan to implement them in 2014.
- Grandfathered status. About one-quarter (26 percent) indicated they will try to keep a grandfathered health plan, which is exempt from certain PPACA provisions. Fifty-five percent will not maintain grandfathered status, and 19 percent are unsure.
- Staff and hour reductions. Few organizations (3 percent) have reduced or plan to reduce their staff. However, 9 percent have already limited part-time workers to less than 30 hours per week, and another 12 percent plan to do so.
- Resources. To help them comply with reform provisions, employers are turning to their insurance brokers (78 percent), SHRM resources (62 percent), legal counsel (48 percent), consultants (34 percent) and internal experts (20 percent).
Stephen Miller, CEBS, is an online editor/manager for SHRM.
Related SHRM Articles:
Employee Benefits Shift in Era of Cost Pressures, SHRM Online Benefits, June 2013
Employer Plans for Health Care Reform Evolving, SHRM Online Benefits, June 2013
SHRM Online Benefits page
SHRM Online Health Care Reform Resource Page