Employers Turn to Healthcare Law’s Requirements

The majority of employers in a recent survey said they had been waiting for the U.S. Supreme Court’s decision before developing a strategy to respond to the law’s provisions slated to go into effect in 2014 and beyond.

While 40 percent said they will begin taking action now that the court has ruled, another 16 percent said they will continue to wait until after the November elections.

Mercer, a human resources consulting firm owned by Marsh & McLennan, polled more than 4,000 employers immediately following the court’s June 28 decision upholding the healthcare reform law.

More than a fourth of survey respondents (28 percent) said that compliance with the new requirement that employees working an average of 30 or more hours per week must be eligible for coverage will present a “significant challenge” for their organization.

“Employers with large part-time populations, such as retailers and health care organizations, are faced with the difficult choice of either increasing the number of employees eligible for coverage, or changing their workforce strategy so that employees work fewer hours,” said David Rahill, president of Mercer’s Health and Benefits business.

The provision that has the most employers worried – 47 percent of respondents – is the excise tax on high-cost plans that is expected to go into effect in 2018.

“Employers already struggling with annual health care cost increases of double or triple general inflation are determined to avoid this tax,” said Sharon Cunninghis, U.S. leader of Mercer’s Health and Benefits business. “We’ve been seeing a lot more interest in cost-saving measures, such as consumer-directed health plans and employee health management, since the tax was proposed.”

When asked whether they agreed or disagreed with the statement, “[The reform law] has provided the impetus for our organization to pursue more aggressive health benefit cost-management strategies,” more than half – 52 percent – agreed.

Employer actions were one factor that helped to slow cost growth in 2011, according to Mercer, and survey results suggest this trend will continue. Asked whether they planned to be more aggressive about managing plan costs going forward, 54 percent said yes. While 41 percent said no, that is because they said they are already taking aggressive action to manage expenses.

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