ACA Having Greater Impact on Employee Benefits

With ACA deadlines occurring in 2014 and 2015, “The Prudential Insurance Company of America’s (Prudential’s) Eighth Annual Study of Employee Benefits: Today & Beyond,” finds that nearly half (49%) of employers report they are extremely or very likely to make a high-deductible health plan their only health insurance option in the foreseeable future.

“Although employers anticipate scaling back benefit offerings due to cost considerations, there’s great opportunity for them to offer voluntary benefits in order to continue providing attractive benefits to their employees,” says Vishal Jain, vice president of strategy, planning and business insights for Prudential Group Insurance, based in Newark, New Jersey. “The Affordable Care Act could very well usher in a new era for and emphasis on voluntary benefits. More employers are utilizing them for recruiting and retaining talent and employees increasingly view them as a cost-effective way to protect their families’ financial futures.”

According to the study, 73% of employers say the law is having an impact on benefits service and support, and 69% report there is an impact on benefits communications. “With a shifting benefits landscape, carriers are now focused on being a trusted resource for employers while offering a full spectrum of services such as enrollment communications, benefits education, recordkeeping and administrative services,” says Jain.

In addition to highlighting the law’s potential impact on voluntary benefits, the report also suggests the provisions on health insurance exchanges considered central to the legislation are top of mind for employees. Other key findings include:

• Employees are increasingly confident more Americans will be covered under the ACA (43% believe this, up 7 points from 2012). An expanding number feel fewer employers will offer health insurance (44%, a 13% increase from 2012), and 38% of those employees believe their employer will drop coverage.
• Most employees report having neither a favorable nor unfavorable opinion toward both public and private exchanges.
• About one-third of employees report they have heard of, but know little about, public or private exchanges. One in five say they have never heard of either type of exchange.

“As employers evaluate the implications of public and private exchanges, the importance of their partnerships with carriers will continue to grow. Employers will look for carriers that provide value, make benefits administration easier, help employees make better benefit decisions, and provide excellent customer service,” says Jain.

Research for the study was conducted via the Internet during August and September of 2013, and consisted of three distinct surveys—one for plan sponsors, another for benefits brokers and consultants, and a third for plan participants.