Doing the Math on Employer Health Insurance by ROBB MANDELBAUM

Doing the Math on Employer Health Insurance

By ROBB MANDELBAUM

Source - http://boss.blogs.nytimes.com/2011/07/13/doing-the-math-on-employer-health-insurance/.

Our post last month on the McKinsey & Company study that suggested — but absolutely did not predict — that up to 30 percent of employers would shed the health insurance plans they now provide workers in 2014, when the Patient Protection and Affordable Care Act largely takes effect, drew some readers into an interesting discussion. After one reader wondered what prevents those companies from dropping health insurance now, another, adam of Washington, wrote a thoughtful response that is worth reprinting at length. The premium calculator he describes was developed by the Kaiser Family Foundation and allows users to enter demographic data and generate an estimate for how much insurance will cost when purchased on the exchanges created by the health care overhaul. Here’s what adam wrote:


The employee’s desire for health insurance is what’s stopping them from dropping coverage now. Employees don’t want to be left to the individual market with its high premiums, pre-existing conditions limits, after tax premium payments, etc. Employers don’t want to lose good employees because their compensation packages aren’t competitive. But PPACA completely changes that calculation since it gets rid of the disadvantages in the individual market. In fact, the individual market will be the better option for many people. Say that in 2014 your employer offered you a raise that was equal to the employer’s cost to provide you with family plan minus the $2,000 penalty*, in exchange for giving up your employer provided health insurance. Since it’s 2014, there would now be an exchange for you to buy health insurance. Would you
more at http://boss.blogs.nytimes.com/2011/07/13/doing-the-math-on-employer-health-insurance/