Most Employers Not Well Prepared for ACA Provisions

Only four in ten mid-size and larger firms indicated they feel “well prepared” to implement provisions of the ACA, whereas only one-fourth of the smallest firms feel this way, according to Deloitte’s 2012 survey of U.S. employers with 50 or more employees.   

Employers believe that they have a “good” understanding of the Affordable Care Act; HR professionals more so than C-suite executives. Familiarity with the individual mandate is the highest (72%) reported. Employer penalties for not offering benefits (66%), essential benefits (53%) and health insurance exchanges (45%) were also familiar to many employers. By contrast, bundled payments, accountable care, etc. are not understood.  

Thirty percent of respondents view the ACA as “a good start,” 59% “a step in the wrong direction.” There was a wide range of opinions, from HR who responded more positively to C-suite respondents who took a more negative view.  

Most do not intend to drop health benefits coverage. Nine percent of companies (representing 3% of the workforce)anticipate dropping coverage in the next one to three years, versus 81% of companies (84% of the workforce) that plan to continue. Ten percent of companies (representing 13% of the workforce) are not sure. Employers cited prohibitive cost as the driver that may lead them to consider dropping coverage. 

To manage health care costs, increased cost-sharing with employees is considered the optimal strategy. Most say they will increase use of co-pays, deductibles and increased premium participation to reduce costs.  

Some employers believe that direct contracting with provider organizations will be a viable cost-containment strategy. CEOs and CFOs are more inclined to think direct contracting is favorable compared to HR and benefits staff. Cost, access and customer service are important factors in direct contracting. 

Employers believe that health insurance exchanges may be a viable channel for employer benefits strategies. Smaller employers view exchanges more favorably than do bigger companies, and particular interest is held in exchanges that offer a wide choice of plans and operate as a non-profit entity.