Health Care Costs shifted to Employees : ACA Demands Higher Costs

This has been going for a long time and it has worked to force employees to take a good look at what they are paying for. But with the advent of ACA taking control of all health coverage and the rising of insurance premiums going even higher, a once good system is beginning to fail the customers.

The nagging question that many among us have is why change the entire system to accommodate a few that can't afford or don't want insurance? Why would be the a good thing? Or is there some other reason that hasn't made it self known yet?

Companies Plan to Pass More Health Insurance Costs to Employees
Source: Theo Francis, "Companies Prepare to Pass More Health Costs to Workers," Wall Street Journal, November 24, 2013.

December 10, 2013

Businesses are feeling pressured to shift more health care costs onto their employees, says the Wall Street Journal.

Between 15 percent and 20 percent of workers tend to skip health insurance. But because of the Affordable Care Act's individual mandate, companies are expecting that more of their employees who had previously opted out will join their health plans. That expected influx, combined with other expenses, is leading companies to raise premium contributions and charge more for the coverage of other family members.

• Haverty Furniture, a retail chain with stores in 17 states, is expecting its health care costs to rise by $2 million (20 percent) next year. It is raising premiums, deductibles and co-payments in response to enrollment increases and higher costs.
• Gannett, which owns 23 television stations and over 80 newspapers, is dealing with increased costs by replacing its health care plans with a high-deductible plan. Some employees saw a 60 percent increase in family premiums.
• UPS plans to keep spouses from joining onto UPS health care plans if the spouse can get coverage elsewhere. Six percent of companies already do this, and another 6 percent charge a fee for covering a spouse.

Lowering costs is not solely due to the Affordable Care Act, as companies have been moving toward putting more costs onto employees for several years and the poor economy is also pressuring firms to keep expenses low.

The Affordable Care Act is also structured in a way that makes it likely that companies will raise the rates of family coverage.

• Companies with 50 or more employees must offer affordable coverage to anyone working 30 hours a week.
• "Affordability" is measured based on the cost of individual coverage, so companies can still raise family rates and recoup some of their costs.
• One survey found that employees this year are responsible for 18 percent of individual coverage costs, compared to 29 percent of the cost of family coverage.