Large employers recently surveyed have calculated that their health insurance premiums will rise at least none percent due to ObamaCare rules and regulations, this on top of standard rate increases caused by over-utilization as an example.
Most large employers are self-funded, that is, they are technically the health insurance company, with a third party administrator handling claims, billing, etc. The administrator also pays claims over a certain amount, say $100,000. The third party administrator can be any number of insurers such as Blue Cross, Aetna, Humana, United Health, etc. It is the employer that decides what claims are paid and how much the employee pays in premium.
The employer will now be faced with cutting benefits or raising premium amounts for their employees and families. Of course this is the exact opposite of what was promised, lower premiums once ObamaCare was implemented. Employers first cut in benefits will be retiree benefits, namely prescription coverage. Prescription coverage for retirees will no longer be tax deductible for employers in 2013, so many employers will simply drop this benefit for their retirees. This will force these retirees into the government’s Part D prescription coverage plan which offers less coverage than their current coverage and costs more. Click Here for more information on Medicare Supplement plans and Part D benefits.
Michael Higgins