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Up to 30% of employers will end health benefits when ObamaCare kicks-in in 2014

Drudge linked to this yesterday afternoon, from MarketWatch:

Once provisions of the Affordable Care Act start to kick in during 2014, at least three of every 10 employers will probably stop offering health coverage, a survey released Monday shows.

While only 7% of employees will be forced to switch to subsidized-exchange programs, at least 30% of companies say they will "definitely or probably" stop offering employer-sponsored coverage, according to the study published in McKinsey Quarterly.

The survey of 1,300 employers says those who are keenly aware of the health-reform measure probably are more likely to consider an alternative to employer-sponsored plans, with 50% to 60% in this group expected to make a change. It also found that for some, it makes more sense to switch.

"At least 30% of employers would gain economically from dropping coverage, even if they completely compensated employees for the change through other benefit offerings or higher salaries," the study says.

It goes on to add: "Contrary to what employers assume, more than 85% of employees would remain at their jobs even if their employers stopped offering [employer-sponsored insurance], although about 60% would expect increased compensation."

So much for "affordable care."  I'm going to go out on a limb here and speculate that most of this 30% are small businesses (less than 100 employees) without 'favored' status in the Obama White House, or that lack the money or lobbying influence to get a waiver from HHS.  Such is the fate of small and medium-sized businesses in the kind of corporate cronyism environment that the Obama Administration has championed.

Of course this could be precisely the way that Obama and the single payer cheerleaders in his administration want to slowly break down the current private health insurance system and funnel workers piecemeal into a totally government-run health care system.

I've long believed that the permanent integration of affordable health insurance with salaried employment has been a problem in this country.  The unemployed, the self employed, and businesses too small to qualify for meaningful group discounts have suffered under this system for decades.  But when the government tries to force 'affordable' health benefit requirements on businesses, the result will be less quality health care for everyone.

ADDED - Flashback to 2010 via Michelle Malkin: "'No one is going to lose their coverage,' said Jay Angoff, head of the HHS office of insurance oversight."
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Comments (10)

The plan was always that th... (Below threshold)
jim m:

The plan was always that they would make it advantageous for employers to drop coverage. That way they can blame the market for single payer health insurance. Frankly, I would be surprised if it is only 30% of employers that drop coverage. I expect it to be closer to 70%.

Michael,I've some ... (Below threshold)
Rodney Graves Author Profile Page:


I've some friends who work at NetFlix. At the end of last year they stopped offering health benefits and instead bumped everyone's salary by $10,000.00 to do with as they saw fit. I expect to see that model adopted widely in the tech industry.

Rodney,As I said i... (Below threshold)
Michael Laprarie Author Profile Page:


As I said in my post, in some ways I am happy to see the stranglehold of employer-provided health insurance broken. But the problem is, all the new ObamaCare rules will make it very difficult for private health insurers to offer affordable individual coverage to workers who now have to buy and manage their own policies.

I believe these new ObamaCare rules were a calculated decision to make employer-provided coverage impractical and private individual policies unaffordable, thus forcing workers into government controlled health exchanges, and then finally into a single payer government system.

Single payer was the goal a... (Below threshold)

Single payer was the goal all along.

Michael,I'm far fr... (Below threshold)
Rodney Graves Author Profile Page:


I'm far from convinced that 0bama care will survive the current court challenges and quite certain it will not survive the end of the 0bama [mis]Administration.

Divider not uniter... (Below threshold)

Divider not uniter

Your headline says "up to" ... (Below threshold)
Jim m:

Your headline says "up to" but the article you quote says "at least". That's a significant difference.

I think it's safe to say th... (Below threshold)
Caesar Augustus:

I think it's safe to say this will not be the subject of a '60 Minutes' expose any time soon.

and, let me be clear on thi... (Below threshold)
John :

and, let me be clear on this point, if you like your current insurance you can keep it.

Incentives work. Who knew?<... (Below threshold)
Jay Guevara:

Incentives work. Who knew?






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