Employers and health care providers came together Friday to discuss strategies for keeping insurance costs low as uncertainty continues to surround the effect of the Affordable Care Act on businesses.
Business leaders at Friday’s Charlotte Chamber Health Care Summit discussed upcoming deadlines in the law, its impact on employers, how to control costs and recent innovations in health care.
Since the U.S. Supreme Court upheld the 2010 law in June, businesses have been working to understand its potential costs and other effects.
Employers with fewer than 50 full-time employees won’t be required to provide health care benefits under the act. Businesses with more than 50 full-time workers will be required to provide a specified level of insurance coverage under the employer mandate of the law. For companies that did not provide insurance coverage previously, costs will increase.
Some may opt to pay fine, forgo insurance
Catherine Como with Wells Fargo Insurance Services, who attended Friday’s conference, said some employers might choose to accept the penalty and not provide insurance because it’s cheaper for them.
Como said the average cost to insure an individual is around $5,000 – twice that amount for a family. The penalty for not offering minimum required coverage is at most $3,000 per worker, she said.
Individuals who do not receive health care benefits from their employers will have the option to purchase insurance through an exchange starting in 2014.
The Affordable Care Act drew criticism from many, including the National Federation of Independent Business, who argued the law could be cost-prohibitive to smaller businesses. Some also have said the law might lead businesses to avoid hiring or to change workers’ status from full-time to part-time.
Helping workers stay healthy can pay off
The importance of educational and wellness programs emerged as a key strategy Friday for keeping employers’ costs down.
Many businesses, including the Ballantyne Country Club, have implemented wellness programs to encourage employees to stay healthy, thereby reducing costs.
Lesley Bays, controller at the Ballantyne Country Club and a panelist at Friday’s summit, said the club began offering a wellness program a few years ago after being faced with a 30 percent rate increase.
“We decided we need to go out and shop the market,” she said. “But at the same time, we said we really need to do something to motivate our employees.”
The plan, for example, gives discounts to employees for getting regular physicals or being tobacco-free.
Bays said the club has seen high participation in the program since the start, and by the end of the first year, costs were reduced up to 3 percent.
“We noticed people going to the gym, people were stopping tobacco usage, people were trying Weight Watchers,” she said. “We’ve had such positive feedback from the employees.”