David M. Gilston Insurance Agency, Inc.

Employer-sponsored health insurance coverage has consistently decreased between 1995 and 2010 and this trend is expected to continue, according to a report created by the Employee Benefits Research Institute (EBRI). The implementation of the exchange program created by the Affordable Care Act (ACA), taking effect in 2014, could cause an increase of employers dropping coverage. 

 A report by the Urban Institute’s Health Policy Center and sponsored by the Robert Wood Johnson Foundation researched employers and offering health insurance coverage. One argument is that through the new exchanges, some companies will likely stop their sponsored coverage, increase their employees salaries to cover purchasing individual policies through the exchange, and pay the penalties under the ACA.

What does this mean to you?

Although dropping coverage could be a realistic option for some, companies that offer employer-sponsored benefits as a way to set themselves apart in a competitive market should consider that dropping their sponsored coverage may not be in the their best interest if they want to obtain high caliber employees. Employers will have to make a personalized decision about whether or not dropping employer-sponsored coverage could hinder their position in a highly competitive market. Agents will play a key role in helping employers make these important decisions.