Will Employer-Sponsored Health Insurance Survive?
By Leah Shepherd
Will the link between employment and health insurance survive?
That’s one of the serious questions that a new report from the Employee Benefit Research Institute (EBRI), a nonprofit research organization based in Washington, D.C., raises about the future of employee benefits.
Paul Fronstin, head of the health research and education program at EBRI, noted that the Affordable Care Act “levels the playing field like it’s never been before,” as employees will not necessarily have to depend on getting health coverage through work.
“Employers are just not sure if they’ll be offering coverage in the future,” he added.
In fact, the U.S. Congressional Budget Office estimates that 3 million to 5 million fewer Americans will obtain coverage through their employer each year from 2019 through 2022 than would have been the case without the ACA.
Starting next year, the ACA will require employers with at least 50 full-time employees to offer a minimum level of health coverage to workers, but some employers may prefer to pay a tax penalty instead of paying for the coverage. The need to recruit and retain good talent is what keeps employers offering benefits.
Kathryn Gaglione, a spokesperson for the National Association of Health Underwriters, says, “Offering comprehensive, competitive benefits makes for a more robust workforce and better compensation for individuals trying to support families … Many American business owners understand the benefit to offering employees and their families coverage. Employer-sponsored health plans might change, but they won’t be going anywhere.”
Most employees want and expect health insurance through their employer, especially knowing that it’s much less expensive to receive group coverage that comes with an employer’s premium contribution than to buy individual coverage on a health insurance exchange (with no employer contribution).
Nonetheless, “one could argue workers won’t need their employers any more for health benefits once the law is fully implemented, and health exchanges become a viable option to job-based health benefits,” Fronstin said.