Employers who offer health plans are holding onto their collective hats following an analysis that shows the White House anticipates half-to-two thirds of small businesses in the United States will be forced to either cancel policies or push workers onto the Obamacare insurance exchanges.
The American Enterprise Institute, a conservative think tank, predicted up to 100 million small- and large-business policies could be cancelled next year before the employer-mandate takes effect, Jan. 1, 2015.
That means almost 80 million people who have coverage through employer health plans will lose their insurance because their policies will not be considered compliant with the new healthcare reform legislation.
Approximately 157 million Americans have health insurance through an employer-based plan.
Business Decisions
No one has felt the pain of meeting mandates of the Affordable Care Act more than employer-sponsored healthcare plans, about half of which are made up by small businesses. Home Depot, GE, Trader Joe's, Walgreen, IBM and Time Warner are just some of the major corporations that have already announced plans to drop health insurance coverage, either for current employees, those retired, or both. Workers under these plans will have to find new coverage under Obamacare or through private exchanges.
Disney World is expected to drop insurance altogether for 24,000 part-time employers because the coverage offered does not comply with requirements of the Affordable Care Act. Orlando area employment giants Universal Orlando and SeaWorld are expected to do likewise.
Big companies make the headlines when they decide to lay off workers or cut healthcare benefits, said Renée-Marie Stephano, president of the Medical Tourism Association. But, far more people are affected when small- and medium-sized businesses are forced to make decisions related to rising healthcare costs. Employers are finding the sticker shock that comes with health insurance to be confusing, complex, and costly.
Rate Increases Expected
Although all of the cards have yet to be dealt and the winners and losers in healthcare reform to be determined, many companies can expect to be dealt substantial rate increases. These costs translate to higher premiums, deductibles and out-of-pocket expenses for employees.
Employers who haven't already cancelled coverage are dodging bullets until the full impact of Obamacare plays out next year. In the meantime, some U.S. employers are responding to the challenges of healthcare reform and turning to medical tourism options that can lower benefit costs, ensure coverage for employees and, at the same time, keep their businesses solvent.
The response has been enthusiastic, said Dr. Joanne Huntington, medical director for SmartCare Worldwide, a Houston-based facilitator which incorporates (medical tourism) benefits into U.S. employer health plans. Not surprisingly, we found that many employees are knowledgeable and have done their own research on (medical tourism).
Huntington, who has collected information at employer health fairs in the United States, said employees are looking for specifics about the day-to-day medical tourism process including procedures that involve major dental work, orthopedic, cosmetic and bariatric surgeries.
Far Short of Goal
The White House has vowed to enroll 7 million Americans through the Obamacare marketplace exchanges. So far, the rollout, which has been greeted by controversy and widespread problems since the www.healthcare.gov site opened Oct. 1, 2013, has enrolled 364,682 people into the private Obamacare insurance exchanges, far short of its intended goal, according to federal figures released this week.
Officials maintain that number, combined with other new statistics, shows there is a tremendous demand for affordable comprehensive health coverage. Consumers have until Dec. 23, 2013, to sign up for Obamacare if they want coverage starting in January 2014. The Obama administration first said that consumers would need to sign up by Dec. 15, in order to give insurers time to process applications, but that deadline was pushed back.
