Employer Positions on Health Reform: Measuring a Moving Target

By Clive Riddle, December 8, 2011

A multitude of studies continue to measure and monitor employer reactions to health reform. The big question typically included in surveys has to do with the employers likelihood of continuing to provide group health coverage. Findings have not been altogether consistent, some studies like McKinsey’s estimate earlier estimated 30% of employers would drop coverage once Health Insurance Exchanges became available, while others estimate a far lower number.

Gfk Custom Research North America this week released findings from such a study (surveying 502 private sector companies) that seems to land in the middle ground, and thus might be a reasonable assessment of employer’s current state of mind. Here’s what Gfk found overall:

• 56% of employers surveyed are likely to continue to offer employer-sponsored health insurance after health care reform is fully enacted
• 12% of benefits decision-makers say they would be very or somewhat likely to drop coverage
• 32% are unsure what they will do

But the important thing to emphasize when bandying about such numbers is the size of the employers surveyed. Gfk notes that “only four percent of decision-makers surveyed from those companies with 500 or more employees considering terminating coverage completely. In addition, decision-makers who say they are familiar with health care reform are less likely to foresee their dropping coverage (7 percent, versus 15 percent among those not familiar).”

In fact, given that HIXs (Health Insurance Exchanges) are being designed to target small businesses in addition to individuals, it is not a bad thing – and one should expect – that employers in that sector would be considering dropping their own group coverage in favor of the exchanges.

The survey also found that employers don’t believe reform will save anyone money:

• 11% believe costs of health benefits will increase more slowly than if no reform had passed
• 51% think costs will increase more rapidly because of reform.
• 38% are not sure about the effect of health reform on future costs.