Willis Group Finds Most Employers to Avoid PPACA Compliance Costs

As businesses come to grips with the impending implementation of the Patient Protection and Affordable Care Act (PPACA), a new survey by Willis Human Capital Practice found that most employers expect to avoid health care reform cost increases; however, more than half have not yet calculated increases. Further, almost two-thirds of employers who have calculated compliance costs have experienced increases.

While 60 percent of surveyed employers report avoiding cost increases as “very important,” most indicate that health care reform has not factored into plan design, benefits offerings, or other related decisions. And just 20 percent of respondents said they expect to modify salaries and bonuses, dental plans, or other benefits in order to offset potential compliance costs.

“The survey suggests that employers continue to recognize the value of providing medical benefits, how important those benefits are to their employees, and that providing benefits allows them to attract and retain the employees they need,” said Willis’ National Legal and Research Group Practice Leader Jay Kirschbaum. “Therefore, they generally plan to continue offering competitive medical benefits. However, they are considering several potential options, even including the possibility of coverage through state exchanges.”

Additional survey highlights include:

• 55 percent of employers expect competitors to shift additional compliance costs to employees while 34 percent of employers reported considering this option.

• 39 percent of employers have chosen to voluntarily forgo grandfathered status compared to 13 in 2012.

• Most employers are planning to offer coverage exceeding minimum coverage requirements than adjust plans after-the-fact to manage expenses.