flipping magazine pagesTruven Health Analytics has determined that there are no short or long-term advantages for eliminating group health benefits and opting for the new federal penalties involved with the Patient Protection and Affordable Care Act (PPACA). Modeled after real-world experiences of American employers, employees and their healthcare experiences, the report reveals the consequences of various healthcare plan design changes and how they will affect operating costs post-PPACA.

Key findings of the report include:

• Group health plans will run at about half the cost of a federally-subsidized plan obtained through a federal exchange. Employers at large companies would face costs of up to $17,269 per employee to shift from their current plan to federally-subsidized coverage, nearly $9,000 more than currently spent.

• Employee compensation would decrease significantly if costs were shifted to employees. Shifting group health costs to employees would reduce employer expenses to $2,000 per employee but increase employee expenses to an average of $16,551 per year in 2014.

“There has been so much conjecture and uncertainty around the impact of healthcare reform on employer health costs over the last two years; we felt it was important to establish concrete benchmarks for the real bottom-line impact of the law,” Christopher Justice, director of practice leadership, Truven Health Analytics and lead author of the paper, said. “This paper provides employers with clarity: there is no cost advantage, short- or long-term, that would come from dropping health coverage for their employees.”

“This research proves once again that when employers invest in the health and wellness of their employee populations, they end up spending less on healthcare,” Raymond Fabius, M.D., chief medical officer at Truven Health Analytics, said. “Not only is eliminating group health coverage not cost efficient, it would have an enormous negative impact on an employer’s competitive market position and – eventually – on the well being of its people.”’


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