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  • Employers Consider Dropping Health Coverage Under Obamacare

    Reports from employers continue to belie President Obama’s repeated insistence that, under his new health care law, Americans would not lose their employer-provided health insurance coverage. A new survey shows that more than one in ten midsized and large employers are at least “somewhat likely” to drop their health coverage once Obamacare’s “exchanges” go into effect in 2014.

    “Let me be exactly clear about what health care reform means to you,” President Obama said during his Obamacare push. “First of all, if you’ve got health insurance, you like your doctors, you like your plan, you can keep your doctor, you can keep your plan.  Nobody is talking about taking that away from you.”

    The president assured “stability and security” in the health care system in the video above (via Guy Benson), but that seems to be exactly what Obamacare is not creating. In addition to companies that said they would drop health care coverage, 20 percent told Towers Watson that they weren’t sure what they will do come 2014. Seven out of 10 employers surveyed expects to lose grandfathered status by 2012. Uncertainty, in other words, is rampant among those surveyed.

    The Associated Press reported Wednesday on a survey by benefits consulting company Towers Watson:

    Employer-sponsored health insurance has long been the backbone of the nation’s health insurance system. But the studies suggest that some employers, especially retailers or those offering low wages, feel they will be better off paying fines and taxes than continuing to provide benefits that eat up a growing portion of their budget every year.

    The exchanges, which were devised under the health care overhaul, may offer an alternative for their workers. These exchanges aim to provide a marketplace for people to buy insurance that can be subsidized by the government based on income levels.

    A large majority of employers in both studies said they expect to continue offering benefits once the exchanges start. But former insurance executive Bob Laszewski said he was surprised that as many as 8 or 9 percent of companies already expect to drop coverage a couple of years before the exchanges start.

    Such a move comes with potential payroll-tax headaches and could subject firms to fines. It also would give their employees a steep compensation cut if companies don’t raise pay in exchange for ending coverage.

    In all, the study found that 9 percent of employers surveyed were “somewhat likely” to drop their health care plans. Two percent said they were “very likely.” That’s actually a slight increase over the findings of the other study to which the AP article referred. Conducted by Mercer, another benefits consulting company, that survey showed that eight percent of employers were “likely” or “very likely” to drop their coverage under the new Obamacare regime.

    Posted in Featured, Obamacare, Scribe [slideshow_deploy]

    23 Responses to Employers Consider Dropping Health Coverage Under Obamacare

    1. Stirling says:

      Businesses will ultimately drop coverage when the regulations and cost make it financially nessesary. In this Obama Economy this will come sooner then later and we will have a single-payer system as the president has wanted all along.. Ultimately the burden of existing entitlements, higher unemployment, higher taxes will criple the private sector which will not be able to support Obamacare's costs.. Then Obamacare will have to be repealed just due to simple economics 101..

      • Michael Packard says:

        Young or old, Democrat, Republican, or Independent, this will affect YOU if the laws go into effect ! You will no longer have a private life without government control, from birth to death !

        Please watch the entire video….it is ALMOST unbelievable! Then forward it to everyone you know. click on website below….


        And……in addition to all these "attributes," the cost of our Medicare insurance will continue to sky rocket!

    2. eliciaalbert says:

      I have read somewhere on the news that something like "Penny Health" is offering lowest health insurance rate for low and middle income families so search online and find them.

    3. mark says:

      So once they drop them, who pays for the health care coverage? I don’t understand.

      • Bobbie says:

        the force of obamacare will be the only resort. 100's of 100,000,000's of dollars are filtering through now! we're paying twice as much for all health costs but getting less service! TRAPPED! all for intentional purposes…
        Who do you hear crying today, who did you hear yesterday concerned about their healthcare? not a soul! It is, was and continues to be unconstitutional and a CON! In the very beginning did anyone here from an actual person that wasn't influenced? no! nobody did!

    4. jon says:

      for mr obamas healthcare,there is apiece of mistletoe on my coattail !

    5. Mike, Wichita Falls says:

      Obama was right. He is not taking away people's health insurance. He devised a system that forces their employers to take it away for him. Now he can welcome them into his utopian system with open arms and the promise that their health care is secure for life. The only question is what will be the quality or quantity of that life?

      When you, your parents or your children are denied procedures, drugs, etc. by insurance companies, you can look for other insurance or appeal to the state. When HHS does so, to whom then will you appeal? Repeal Obamacare!

    6. marcustullius says:

      Employers who are fed up with the difficulties in providing health coverage and plan to drop employees, should switch to “Defined Contribution” plans. One such defined benefit plan is explained in this Fox Business article. http://smallbusiness.foxbusiness.com/legal-hr/201
      "The employer will continued to make a defined contribution, whatever the amount defined by the Fed will be, and the employee can use the (state health) exchange."_

    7. Bobbie says:

      more tremendous, needless unconstitutional sacrifice from the American leadership of Obama. making more of a mountain out more of a mole hill. He heard the people making this intentional and that can't be trusted. Build the free market without government intrusion or bring down the med costs through the market without government intervention! Stepping into our lives is not the feds job, now we have to waste our lives easing them out!!

    8. As a small business owner with 35 employees, we will drop our employees from their current health care and pay the penalty. Why? Because it's cheaper. And so, our 35 employees and their families and our family will all get dumped into Obamacare. This is the reality for not only us, but for thousands of small businesses across the country like us who are trying to keep our head above water in this economy and keep our business going so our employees don't have to go on those economy-stimulating unemployment checks. Thus the rolls for Obamacare will expand exponentially with no money to pay for it. You get to keep it. Yeah, right. What a big, fat lie.

      • frank says:

        So you will dump your health insurance to save money, not because it will cost more to have. I believe that Obamacare will lower health insurance cost.

    9. I think it would be fantastic if employers did drop healthcare. I consider employer-based healthcare the reason it's so high. Who's more likely to pay a large health insurance company, a company or an individual? The employer would rather pay healthcare costs for employees than to pay government tax on that money b/c they can use that benefit as a means to drive down salaries or to "trap" they employee by making them dependent on them for health insurance – thus benefiting themselves rather than the government. Thus, the insurance companies win big and workers out there with little employee benefits have to pay a steep price. Employee based healthcare is what has destroyed it for everyone else not getting it. Insurance should be paid by the individual it covers – it's the only way to keep the health insurance companies honest and costs down.

      • James Meyer says:

        I agree. If you want health care security and independence it should be separated from employment. The question to ask as an employee of a company that would drop insurance is whether or not employers will raise pay in a amount roughly equal to the cost they would otherwise pay for insurance premiums. Once dropped by employers, then employees can buy the insurance through the exchanges which will be a better way to go in the long run. Then no one is trapped in a job because of health insurance. Plus, why would any good employer want to provide coverage if employees can purchase insurance efficiently through exchanges. Why should health insurance be provided through employment? You do not get your car insurance from your employer do you? If enough employers dropped insurance then the insurance pools will be bigger and more efficient through the exchanges and the rates will be just as good as purchasing insurance through an employer. Then you do not need to worry about insurance if you are laid off or decide to quit.

        • I agree. The ONLY reason I am where I am now is because they offered health insurance that would cover my pre-exsisting condition. If I was able to get my own insurance I would be able to actually get a job in my field and it wouldn't matter what benefits were offered.

    10. Only people who dislike the affordable health care act( obamacare) are greedy insurance companys who can't charge an arm and a leg for health insurance no more. Companies who drop their health insurance can now give that money to their employees and employees can get obamacare which is cheaper and if they loose thier job they keep their Medicare. Captilism is cool, its what America is built on after all but it should not be in the same catagory as healthcare. Funny how were the only country who believe healthcare should be strictly buisness and not a right…

      • bill says:

        Get real girl and don't be so naive. Obamacare wil destroy what we have today ..then maybe you can move to Spain and wait in line for your appendectomy for one year

    11. As someone with a pre-exsisting condition who gets very limited health insurance through my job, I completely support a universal healthcare plan. Even if I had to pay more in taxes at least maybe I would be able to afford to go to the doctor to keep an eye on my condition. Since my specialist is not in my plan I would have to pay hundreds of dollars up front just to see him, let alone all of the tests I would need since I haven't been to the doctor since I got this insurance. Something has to change. We need healthcare for everyone. My life, and many others could hang in the balance. Sometimes I wonder what these Congressmen would do if they lost their coverage (or someone in their family lost theirs) and then they got diagnosed with cancer or some other serious disease. How would they like it?

    12. DMU says:

      Healthcare should be a right as a citizen. If you work for the government or a large employer you get healthcare. Is that just the luck of the draw? People who have healthcare and complain about what the new laws will bring have probably had healthcare from their parents to employer, and never in their adult life have had to wake up in the morning put their feet on the floor and instantly worry or hope that they don't have some type of medical issue today. That is an overwhelming mental burden for a large majority of honest hardworking Americans and their families. The people with employer provided healthcare should take a minute to ponder that feeling and what stress and burden this would add to their everyday lives. All American citizens should be able to have the right to pursue happiness and thats hard to do when the worry and fear of getting sick or injured could devistate you or your family.

    13. DEE says:

      obamacare is a TAX.. plain and simple… i can just see this nightmare… more irs agents… federal employess
      bloated goverment… cant get in to see a doc..
      i agree there are issues we need to address.. pre exsisitng conditions.. ..
      we do not allow the ins co to compete … open up competition.
      but i wont.. I will fight this…

    14. zeke says:

      We have seen how the government really does not keep a good eye on expenses since the money they spend comes out of our pockets. Why would we believe that things will be completely better with Obamacare?
      Yes, parts of it are good; leaving people with pre-existing conditions buy the insurance at the same rate, extension of young adults under parents insurance is good. But when it is all said and done we will be sorry because the companies will drop the insurance and let the tax payers (us) pay for it all without any self responsibility for our own health and its cost.
      Let there be huge pools that people can get into, let the fines companies pay the be same whether they drop insurance or keep it. Let there be cost over site of the industry but please do not let us have mandated government run insurance. Other countries have found out their cost are increasing rapidly with this and other countries will soon find it un-affordable. I same sure some countries with a healthy mostly homogeneous native born citizens often fairs better than our large population with higher drug use, fatherless families, uneducated wealth fare ridden population, with its increasing large illegal immigrant population will not ware well.
      Somebody save us

    15. Scott Ellis says:

      I can see how businesses dropping health care coverage would be very beneficial to all. In this sense I understand why there is a fine for not having health care. 1. They want to make sure you're covered if the employers want to drop the coverage and 2. The companies will have so much more money from not having to pay for health care coverage.

    16. sports music says:

      There are a lot people in this country that think the government should provide everything for them. Healthcare is just the latest item. Social Security was set aside to help supplement when you got older not replace the responsiblity of everyone to save for when they got older. Then it was Medicare because people were living longer and still had not saved for their health care. Next was unemployment checks how can anyone lay around the house for 99 weeks and do nothing. There is always a job out there for anyone that WANTS to work. It may not pay what an individual thinks they are worth but it is a job. And people who have any kind of job can find a better job. Now people don't want to be responsible in find good jobs with healthcare benefits. So in today's world we can't tell someone you can't make the soccer team, everyone is entitled to have what they want or ask for and not accountable for their actions. So we are now being led down the path of socialism not capitalism which made the USA the leader of this world. Don't look now but we haven't been the leader since the Regan years. Thank you slick Willie and his side kick Mr. Obama.

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