Jan 28 2010
A significant majority of U.S. employers believe health care reform, if
enacted, would lead to higher costs for both employer-sponsored benefit
programs and health care services overall, according to initial results
from an employer survey conducted by Towers Watson and the National
Business Group on Health. A separate Towers Watson survey of U.S.
employees found that a majority of workers think health reform will not
only lead to higher costs, but decrease the quality of care and reduce
the benefits available to them.
“While health
reform could ultimately provide greater access to health care to more
Americans, there is a fair amount of skepticism over whether health
reform will be able to curb rising health costs.”
“Although the status of legislative health care reform is currently in
limbo, it’s clear that employers and employees alike are concerned over
the potential impact reform could have on health costs and their benefit
programs,” said Ron Fontanetta, Towers Watson Health and Group Benefits
practice leader for Intellectual Capital Development. “While health
reform could ultimately provide greater access to health care to more
Americans, there is a fair amount of skepticism over whether health
reform will be able to curb rising health costs.”
The Towers Watson - National Business Group on Health survey found that
nearly three-fourths (71%) of employers believe health reform will
increase the overall cost of health care services in the United States,
while 69% believe it will increase the cost of their benefit programs.
Additionally, more than one-third (35%) say health reform will lead to
fewer employers offering subsidized benefits. Nearly half (46%) of
employers believe it will decrease employer-sponsored offering of
retiree medical benefits, while very few -- only 5% -- say it will
increase, and just 27% of employers say it will cause no change.
“These survey data confirm quantitatively what many people -- employers,
employees and policy pundits -- have been talking about for the past
four months. That is, whatever else a health care reform plan might
do, it is unlikely to control health care costs, which has everyone
worried,” said Helen Darling, President of the National Business Group
on Health.
On balance, there are some pluses and some minuses in employers’ views
and expectations from health care reform. On the one hand, roughly
one-fourth (27%) believe it will lower health care quality and decrease
the value of benefits that employers offer, but 39% and 40%,
respectively, say it will have no change in these areas. On the other
hand, a majority (71%) believe health care reform will increase access
to health benefit coverage. In other encouraging outcomes, 34% believe
it will increase transparency of provider prices, and 30% say it will
increase the transparency of provider quality. Additionally, just over
one-third (34%) believe health care reform will increase adoption of
total replacement consumer-driven health plans (CDHP) by large
employers, while only 9% believe adoption will decrease, and 27% believe
there will be no change.
The separate Towers Watson survey of approximately 1,000 workers at
midsize and large U.S. companies found similar concerns over health
reform. Two-thirds (67%) believe health reform would result in higher
benefit costs, while more than one-half (54%) believe it would reduce
their available benefits and lower the quality of health care (53%).
This survey also found that 40% of employees would not be comfortable
purchasing their own insurance in the reformed markets as an alternative
to getting coverage through their employer. The current legislation
proposals include a mandate for all individuals to have health insurance
coverage, which ultimately could impact employees who currently receive
insurance from their employer -- if the employer decides to terminate
the company plan and pay into the system instead.
“All eyes remain on Congress, and there will likely be trade-offs in
whatever final legislation emerges from their negotiation process,” said
Steve Raetzman, senior consultant for Towers Watson. “However, with or
without health care reform, employers will continue to look for ways to
control rising health care costs and provide high-quality health care
for their workers and families.”
Source: Towers Watson