Employer Size Greatest Indicator of Financial Effects of Affordable Care Act
The financial impact of the new Affordable Care Act (ACA) on businesses is far less than anticipated, ameliorating employer fears and reviving hope that most companies will decide not to drop coverage due to changes in healthcare laws. This unexpected optimism was uncovered by the new 2012 Midwest Business Group on Health employer survey. Additionally, a significant portion of respondents expressed growing support for the new provisions and their effects on the quality and accessibility of coverage information to consumers.
Andrew Webber, president and CEO of survey co-sponsor National Business Coalition on Health said, “Employers appear to be warming up to the potential value of ACA provisions on prevention and wellness incentives, provider payment reform, medical homes, ACOs, and cost and quality transparency even while expressing continued frustration with the law’s slow pace towards cost containment,” he continued, “And while employers seem to have less of an appetite for dropping coverage than noted in previous surveys, alternatives like defined contribution strategies are beginning to be considered and bear close monitoring in the years ahead.”
Key findings gleaned from the survey indicate that many businesses are finding that ACA compliance is must less expensive than originally anticipated, though larger employers found the cost impact of the mandate to be less than 2 percent. The majority of small and mid-sized company’s reported increases up to 5 percent. The survey showed that only 6 percent of respondents plan to drop employee health benefits coverage and pay the penalty fee; an over 50 percent decrease compared to results from a similar survey in 2010. However, 42 percent of respondents hope that the ACA is entirely struck down as increases to overall benefits costs are expected to be 10 percent or greater.