March 12, 2015
In our book, we project that by 2017, the majority of small businesses that now offer health insurance will switch to defined-contribution. This is being led by small business owners. But it doesn’t stop there.
A few years ago, some big companies [Verizon and AT&T] leaked documents saying they were evaluating dropping health insurance plans. Some big companies will drop their plans and that will have a snowball effect. We project that 90% of all businesses will drop offering health insurance plans in the next 10 years.
via The End Of Employer-Provided Health Insurance.
February 24, 2015
The Cadillac high-cost health plan excise tax, which goes into effect in 2018, is one of the last-to-be-implemented provisions of the Affordable Care Act (ACA). It was one of the most controversial provisions of the ACA, which contributed to its delayed effective date. But 2018 is now getting closer, and the Internal Revenue Services (IRS) is beginning a discussion about implementation of the Cadillac plan tax.
The Cadillac plan provision of the ACA will impose a 40 percent excise tax on the cost of employer-sponsored health plans when that cost exceeds certain thresholds. It is projected to be one of the biggest sources of revenue under the ACA; the Congressional Budget Office (CBO) in its 2015 Budget and Economic Outlook Report estimated that it would account for $149 billion in revenue between 2018 and 2225. Of this, however, only one quarter will come from the tax itself, while three quarters will come from increases in taxes on income as employers shift compensation from health benefits to taxable wages.
via Implementing Health Reform: Beginning The Cadillac Tax Regulatory Conversation And Other ACA News – Health Affairs Blog.
February 24, 2015
One problem is that only about 5% of families have children and are supported by low-wage earnings; another is that higher minimum wages cause some workers to lose their jobs. Advocates of a higher minimum wage argue that the number of workers who gain far exceeds those who lose. Whatever the credibility of this calculus, there is yet another problem: If someone’s income is arbitrarily increased thanks to a legislatively mandated wage increase, someone else must pay for it.
Since economic evidence indicates that higher minimum wages don’t significantly affect employers’ profit rates, advocates instead say that employers will pass on these increased labor costs by raising the prices of their goods and services—and that “society,” or more affluent consumers, will pay these costs.
But will low-income families earn more from an increase in the minimum wage than they will pay as consumers of the now higher-priced goods? My research strongly suggests that they won’t.
via Thomas MaCurdy: The Minimum-Wage Stealth Tax on the Poor – WSJ.
February 24, 2015
Private health insurance exchanges will continue to draw broad interest from employers in 2015, but new adoptions will likely be limited to benefit programs for certain types of employee groups as employers start to ask what they have to gain from using them, according to a new report by Wells Fargo Insurance Services USA Inc.
Employers with large retiree populations, as well as firms in industries with traditionally low-wage or part-time workforces, are more likely to gravitate toward private exchanges as an alternative means of providing health care benefits next year, Wells Fargo said in its 2015 Employee Benefits Outlook report.
“There are good reasons for going into an exchange,” Tim Prichard, Wells Fargo’s executive vice president and national employee benefits practice leader in Woodlands, Texas, said. “Retiree populations and high-turnover, low-income or part-time workforces are probably a good fit for an exchange solution. But we’ve seen very few employers outside of that moving to exchanges for active employees.”
via Employers vetting private health exchanges more closely: Report | Business Insurance.
February 23, 2015
The Obama administration has blocked health plans without hospital benefits that many large employers argued fulfilled their obligations under the Affordable Care Act.
Companies with millions of workers, mainly in lower-wage industries such as staffing, retailing, restaurants and hotels that had not offered health coverage previously, had been flocking toward such insurance for 2015.
Plans lacking substantial coverage of hospital and physician services do not qualify as “minimum value” coverage under the law and so do not shield employers from fines of $3,000 or more per worker, the Department of Health and Human Services said late Friday.
via Obama Administration Disallows Plans Without Hospital Coverage | Kaiser Health News.
February 19, 2015
The Internal Revenue Service continues to struggle with the question of how the Affordable Care Act affects various arrangements through which employers attempt to pay premiums for employees to purchase health insurance coverage in the individual market. The federal agencies have already issued four guidances on this issue over the past two years in January of 2013, September of 2013, November of 2014, and December of 2014. On February 18, 2015, it released yet another guidance on this issue, this one focused on small employers.
The question addressed by these guidances is whether an employer, instead of offering its employees a traditional group health plan, can use a health reimbursement arrangement (HRA) or some other form of employer premium payment plan to pay employee premiums for individual market coverage. The February 18 guidance covers premium payments for Medicare and Tricare as well.
via Implementing Health Reform: Preliminary 2015 Enrollment Numbers; Guidances – Health Affairs Blog.
February 19, 2015
The U.S. Chamber of Commerce and 17 other business groups — including the National Retail Federation and the Council for Affordable Health Care — on Wednesday (Feb. 18) sent a letter to HHS Secretary Sylvia Burwell urging her to immediately announce a two-year delay of the ACA provision that expands the small group market for employers with fewer than 50 workers to include those with up to 100 employees in 2016.
via Business Groups Urge Burwell To Delay Small Market Expansion For Two Years | InsideHealthPolicy.com.