ACA Has Made “Virtually No Change” in Employer Health Plan Enrollment Numbers
Between 2014 and 2015, there has been “virtually no change” in the average percentage of all employees – full-time and part-time – enrolled in employer-sponsored health plans, according to a recent Mercer survey. “Health Care Reform Five Years In,” a study of nearly 600 employers, also showed that the 1.6% increase in the absolute number of employees enrolled was a result of a 2.2% increase in the size of the workforce, instead of a result of changes required by the Patient Protection and Affordable Care Act (ACA).
Braced for bump. “Employers that had to offer coverage to more employees were braced for a bump in enrollment this year, but they didn’t know how big it would be,” said Tracy Watts, a senior partner and leader for health reform at Mercer. “While some did see increases, for the most part it seems the newly eligible either had coverage through a parent’s or spouse’s plan or through Medicaid – or are continuing to go bare.”
Eligibility versus enrollment. The survey revealed that the average percentage of employees eligible for coverage rose (from 87% to 88%), but the number who actually enrolled dropped (84% to 83%), leaving the percentage of all employees, eligible and ineligible, who enrolled in 2015 essentially unchanged, compared to 2014 (74%), says Mercer. The industry sector most affected by the employer mandate’s 30 hours rule comprised the food and lodging businesses, due to their high concentrations of part-time workers, and the average percentage of employees eligible in that sector grew from 57% to 60%, but, again, the number actually enrolled was lower, and only rose by less than one percentage point, to 34%.
Why was effect so slight? Mercer discovered a number of reasons why the ACA appeared to have so little impact on enrollment numbers. For example, 81% of employer respondents were already in compliance with the ACA’s eligibility requirements prior to 2015. In addition, some employees who were formerly enrolled in their employers’ plans are now waiving coverage because they are eligible for expanded Medicaid.
Mercer also took note of the fact that only three percent of respondents said that they were likely to drop their plans within the next five years. Beth Umland, Mercer’s director of research for health and benefits was quoted as saying, “The need to compete for talent is the number one reason employers don’t drop coverage, but for those that might be tempted, the ACA makes it that much harder to do.”
Source: Mercer news release, March 17, 2015.
Reposted with permission from Wolters Kluwer.
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