The deadlines have passed for individuals to sign up for coverage without penalty. But what about the impact to employers? Businesses with 100 or more employees may face significant increases in employee costs – nearly $6000 extra per employee, one study finds.
The American Health Policy Institute (AHPI) conducted a new study to ascertain the average cost increase to large employers. It is difficult to anticipate how businesses will react to the new system, and until now there has been almost no data that could be used to analyze results. The study used internal cost data from companies with over 10,000 employees each, and made the following findings.
Over the next decade:
- The ACA will cost large U.S. employers between $4,800 to $5,900 per employee.
- Large employers expect overall ACA-related cost increases of between $163 million and $200 million per employer, or an increase of 4.3 percent in 2016 and 8.4 percent in 2023 over and above what they would otherwise be spending.
- Based on this data, the total cost of the ACA to all large U.S. employers will be from $151 billion to $186 billion, or 5.9 percent more than what they would otherwise be spending.
It should be noted however that large businesses who already provide health care coverage to their employees will not face these cost increases in the same magnitude. Rather, cost increases for individual businesses depend on whether or not their current policies are in compliance with ACA. Also, laws and time lines differ depending on the size of the business in question. Large businesses with 100 or more employees will be affected sooner than smaller businesses.
Large or small, companies nationwide are facing pressure to amend their health care coverage to employees. Businesses will have to make some tough decisions on subsequent staffing and financial decisions for the future.
Read the full report here: http://www.americanhealthpolicy.org/Content/documents/resources/14-21_PR_AHPI_ACA_2014_Cost_Study.pdf
