Obamacare

Employers Expect Costs to Rise Under Obamacare

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During the health care overhaul debate, President Obama promised repeatedly that his legislation would bring down health care costs. But according to a new survey of large employers by Towers Watson, many organizations with significant financial stakes on the line aren't betting on it. NCPA President John Goodman has the highlights:

  • "The overwhelming majority (90%) of employers believe health care reform will increase their organization's health care benefit costs;"
  • Nearly nine in ten firms (88%) plan to pass increased costs from the law on to their employees through higher premiums;
  • Nearly three in four firms (74%) plan to pass the law's higher costs on to their employees by changing plan options, restricting eligibility, or increasing deductibles or co-pays;
  • More than one in ten firms plan to pass on the law's higher costs by reducing employment (12%) or reducing employer contributions to retirement plans like 401(k)s (11%);
  • Of those firms offering coverage, 43% are "likely to eliminate or reduce retiree medical programs" as a result of the law's enactment.

I noted another study looking at how many employers might drop coverage here and took a look at the Affordable Care Act's tax effects on businesses large and small here.