There’s been an enormous amount of speculation about employers dumping workers from health care plans, thanks to the Patient Protection and Affordable Care Act. Now, two academic studies suggest an altogether different outcome:
While few employers will use the act to drop their health plans, at least immediately, millions of workers who are covered at work could instead choose insurance through state exchanges.
How many millions? Roughly 37 million, according to Dr. Jay Bhattacharya of Stanford School of Medicine.
“The reason is that these workers would qualify for substantial subsidies to buy exchange insurance,” he said.
In other words, the subsidized Obamacare premium will be less than what they pay for employer-based insurance.
This assumes employees will turn to exchange insurance because the coverage they are offered by their employer is not considered affordable. Employer-provided coverage must be less than 9.5 percent of an employee's household income to be considered affordable under the PPACA.
In the meantime, another study, from the University of Michigan, found that most employers will continue to offer health coverage to employees, despite having the opportunity to do away with it.
The entire scenario can be found in the pages of the September issue of the medical journal Health Affairs.
The Stanford School of Medicine team examined subsidy outlays for premiums and cost-sharing for individuals purchasing private insurance through exchanges.
What its investigation turned up could have profound implications for the government’s role in providing financial support for insurance purchased through the exchanges.
“Our findings show that changing theoretical premium contribution levels by just $100 could induce 2.25 million individuals to transition to exchanges and increase federal outlays by $6.7 billion. Policy makers and analysts should pay especially careful attention to participation rates as the act’s implementation continues,” the Stanford researchers cautioned.
About 170 million Americans have health insurance through their own job or through a family member's; such coverage is available to 80 percent of full-time workers.
The Stanford researchers noted that the existence of a “better deal” through a state exchange might not sway an employee to leave the security and comfort of coverage chosen by an employer. Rather, the study stressed that its findings indicated that state exchange insurance may turn out to be more successful than anyone originally thought at attracting customers.
The Michigan study said the net increase or decrease in the number of workers with employer-sponsored health insurance will be only a percent or two.
That corresponds with a survey released last month by the National Business Group on Health, which represents large employers. It found that 1 percent were considering moving current employees to exchanges in 2014, though 30 percent might do so after that.