ACA progression to spark employers’ benefit decisions

The Affordable Care Act’s ongoing rollout is likely to spark many employers to take action within their benefit plans. Whether it is utilization of a high-deductible health plan or emphasizing voluntary options, employers say that a change is imminent, according to a new study’s findings.

Prudential Insurance Company of America’s eighth annual Study of Employee Benefits finds that the ACA’s advancement is central to employer decisions over the next year. Nearly half of the surveyed employers report that they are extremely or very likely make high-deductible health plans or consumer-directed health care plans their only care option.

“Although employers anticipate scaling back benefit offerings due to cost considerations, there's great opportunity for them to offer voluntary benefits in order to continue providing attractive benefits to their employees,” says Vishal Jain, vice president of strategy, planning and business insights at Prudential Group Insurance.

Last month, the Internal Revenue Service, along with the Department of Treasury, disclosed that employers with fewer than 100 employees were granted a one-year exemption from providing insurance on Jan. 1, 2015. These companies are still required to report their workers and coverage next year, but will have until 2016 to pay for affordable health insurance for their full-time workforce. The employer mandate delay was widely debated by employee benefit researchers and benefit industry decision-makers.

Prudential’s study – which tracked responses from plan sponsors, plan participants and benefits brokers via the Internet - finds that 73% of the survey group reports that health care reform law is impacting benefits services. Also, approximately 69% state that it is affecting benefits communications.

“With a shifting benefits landscape, carriers are now focused on being a trusted resource for employers while offering a full spectrum of services such as enrollment communications, benefits education, record keeping, and administrative services,” Jain says.

Additional studies have found that employers were continuing their benefits offering over the next three to five years, with plans to change retiree costs in order to institute savings. Other research has pointed to employers increasing corporate wellness incentives by 15% within their health care plans to promote take up. Moreover, prior studies have found that there is a wide disparity among what value employees place on their benefits packages and wellness programs.

According to Prudential’s results, roughly 43% of employees surveyed – a 7% increase from 2012 – feel confident that the ACA will cover more Americans while 38% believe that their employees will drop coverage. Another alarming result finds that about one-third of employees report knowing “little” about public or private exchanges.

“Employers will look for carriers that provide value, make benefits administration easier, help employees make better benefit decisions, and provide excellent customer service,” Jain explains.