How Will Health Care Reform Impact Group Health Insurance? in Health Care Reform
President Obama stated this week that the new health care bill has already helped millions of Americans, adding that many health insurance companies have begun allowing young adults to stay on their parents’ insurance plan ahead of schedule.
All major health insurance companies have also officially discontinued the practice of rescission – or canceling health insurance policies when people get sick – ahead of the September deadline that would have made it illegal to do so.
However, concerns regarding how the bill will play out in 2014 in terms of group health insurance have surfaced this week. In particular, some people are concerned that large employers will find it more affordable to stop providing health insurance to employees and to pay the fines that would be levied against them instead.
These employees would then be required to purchase their coverage from the health insurance exchanges set to be up and running in all 50 states by then.
According to the new bill, companies of 50 or more employees would face a fine if they did not offer health insurance to their employees. But according to documents released by AT&T this week, dropping employee coverage altogether and paying the fines would save them millions of dollars.
According to the Dallas News, AT&T paid around $2.4 billion dollars last year to insure their employees. If they dropped their insurance plan in 2014, and paid the fines instead, they would only have to pay $600 million dollars.
These figures concern those analysts who fear that the insurance offered by the exchanges won’t be as good in quality as that offered by big companies like AT&T.
In response, supporters of the bill argue that the money saved would be good for the economy, providing big companies with extra funds and therefore reason to hire more employees.
Or to offer more raises, and better compensation in general, to those employees they already have.
Furthermore they suggest that because the exchanges will be subject to federal oversight, and required to offer a minimum of coverage and preventative care at affordable prices, people shopping for health insurance on the exchanges will still get good coverage.
However, until 2014 there is no way to know whether either side is correct. The coverage required of the health insurance exchanges doesn’t exist yet, and these portions of the law won’t go into effect for some time. Whether or not the law will even look the same by then is speculative.
And currently, AT&T has no plans to cancel its health insurance plan.
