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Survey Cost Is Main Barrier to Offering Health Plans

Many employers do not offer health care benefits to their employees because of the high cost, and a large percentage of employers are unwilling to contribute more than $50 a month for those benefits, according to a recent survey.

October 24, 2008
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Many employers do not offer health care benefits to their employees because of the high cost, and a large percentage of employers are unwilling to contribute more than $50 a month for those benefits, according to a Mercer survey.

Forty-three percent of the employers that do not offer health plans said cost was the primary reason; 59 percent of the same group of employers said they were willing to contribute between $0 and $50 per employee per month for health benefits. Further, 49 percent of respondents said they weren’t at all likely to begin offering coverage within the next three years.

Mercer surveyed 3,418 employers, of which 545 do not offer health benefits. Employers surveyed were classified as small (10-499), large (500-plus) and very large (20,000-plus). The results released are part of the consultant’s larger National Survey of Employer Sponsored Health plans, which will be released in November.

Employers were inclined to disapprove of each of the eight health care proposals offered by presidential candidates, members of Congress and state governments mentioned in the study, and no one proposal—from “play or pay” reform to a proposal that would end or cap the tax exclusion for employer-sponsored health benefits—was decidedly more popular.

Employers in Massachusetts, Vermont and San Francisco, where health care reforms requiring employer compliance have taken place, were asked about the effects of such reforms.

Sixty percent of small employers in those geographic areas said they complied with the law with minimal or no additional resources; 37 percent said some resources were expended but other priorities were not affected; and 3 percent said considerable resources were expended and other priorities were affected.

Large employers in those areas, on the other hand, were affected differently. Thirty percent said minimal or no additional resources were used to conform; 60 percent said other priorities were not affected while some resources were expended; and 10 percent reported their priorities were affected and considerable resources were expended.

Filed by Kristin Gunderson Hunt of Business Insurance, a sister publication of Workforce Management. To comment, e-mail editors@workforce.com.

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