Large Companies Faced With Uncertainty Over Effects of New Health Care Law
By Jim Angle
FoxNews.com
Published August 18, 2010
Large American companies, already facing rising health care costs along with their employees, also are struggling to figure out how the new federal health care law will affect them.
Helen Darling of the National Business Group on Health cited a survey of 72 large companies, which acknowledged "we are in middle of transformation, a transformation of how health care is financed and delivered in this country," she said.
The large companies said they expect their health care costs to rise next year by about 9 percent, two percent more than they rose this year. They attribute one percent of the two percent increase to the early provisions of the new health care law.
The companies have several strategies for dealing with increased costs and many say they'll do what they have been doing -- ask workers to pick up a larger share:
Fifty-seven percent of the employers say their employees are paying a higher portion of their premiums this year, and 63 percent say they'll ask workers to pay more next year.
And 36 percent of the companies increased the out-of-pocket maximums this year -- the amount a worker has to spend before the company picks up the tab.
Another popular change has to do with workers' regular prescriptions: 47 percent of these employers expect to make workers get their regular prescriptions by mail order. If prescriptions are obtained elsewhere, insurance would only reimburse the mail-order cost.
President Obama and Democrats who backed the health care law argue that measures contained in the law will move the country toward containing such runaway costs, which have been raising alarms for years.
But employers are starting to wrestle with the implications of the law as well. For instance, in 2013, retiree drug subsides will be subject to taxes, so employers are taking a second look at how they treat retirees.
Conservative economic analyst Doug Holtz-Eakin says employers are "eyeing elimination entirely of a lot of their retiree coverage."
In fact, 69 percent said such benefits are under review, awaiting clarification from the administration, which is just starting to write all the rules and regulations needed to give employers a better sense of how the law will affect them.
Katie Mahoney of the U.S. Chamber of Commerce, which supported the new law, says employers are waiting to see all the rules on how the law will be implemented. For now, she says, "there is a cloud of uncertainty as to what employers and plans and individuals need to do to comply with the law and the regulations."
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