When Employer Behaviors Change

The House Ways and Means Committee released a new report that has received some media time over the past few days. The report, “Broken Promise: Why Obamacare Will Force Americans to Lose the Health Care Coverage They Have and Like” provides a summary of the results of a Fortune 100 survey concluding many employers will simply drop their employer sponsored insurance (ESI) because of the way the rules and fines established by the Affordable Care Act and move their employees to the Health Insurance Exchanges to purchase their coverage. Paying the fine imposed in the Affordable Care Act is cheaper than providing coverage.

The report states the Affordable Care Act “threatens the stability and sustainability of the employer-based health insurance system.” As if it is stable and sustainable today.

The report estimates employers will save nearly $29 billion in 2014 alone and over $422 billion between 2014 and 2023 using the fine-paying approach. Sounds to me like those savings could be a great boost to the economy, to the global competitiveness of employers, and in creating jobs. The report doesn’t talk about that because it is intended to deliver a different message.

The report should probably have an addition to the title to really clarify what we’re dealing with for the general public; “Broken Promise: Why Obamacare Will Force Americans to Lose the Health Care Coverage They Have and Like--- But Won’t Be Able To Afford for Much Longer.”

Anybody who might have thought “nothing will change” for the employees with any health reform model (Republican or Democrat) was simply naïve. “Nothing will change” is the politically correct way to talk in an election season- hopefully, the American people know better.

Things are already changing and they have to keep changing if we’re going to head off the real health care cost crisis before it actually happens. The sooner the politicians and the media can start to talk straight with the American people, the sooner they will get on board and help to become part of the solution.

The information and subject of this report is important. Employers are going to change their behaviors when the incentives of the game are changed. When employers change their behaviors, things are going to change for the employees. It’s not complicated. What is complicated is coming up with alternative solutions to address the changing behaviors and at least help the employees plan for what may be coming down the road. Unfortunately, this report didn’t get that far. And, probably didn’t try.