Tip of the Day: Start deciding whether you want to pay or play

Released this week, Senate Finance Committee chair Max Baucus’ (D-Mont.) health care reform proposal seems to have spared employers from an outright mandate to provide health benefits. However, the bill does include a pay-or-play provision – as in, provide coverage or pay up to subsidize coverage in the mysterious “exchange.”

As the Baucus plan is being (slightly) less attacked so far – granted, it’s only been a few days – perhaps it’s time for you to consider whether you’d like to pay or play, should that part of the bill pass.

To help you decide, new survey results from Towers Perrin show how employers expect they would respond to a pay-or-play mandate:
* 37% of employers would provide company-sponsored health coverage that substantially exceeds the standard.
* 29% of employers would discontinue company-sponsored health coverage and pay the assessment if the per-employee costs of payments to the federal government were substantially lower than their current costs.
* 26% of employers would provide company-sponsored health coverage at the level of the minimum standard required.

“In some industries, particularly those with low margins and lower-income/high-turnover employee populations, some companies would, under a mandate, choose to write a check to the government and allow employees to purchase coverage in a reformed market for individual health insurance,” noted Fontanetta.  “For example, fully 42% of retail companies in the survey said they would close their plans and pay a federal assessment, versus 28% of those in financial services and 24% of those in technology/telecommunications.”