Tuesday, September 1, 2015

Will you lose your employer coverage under Obamacare? Odds are you won't

An often-heard concern about the Affordable Care Act is that is will cause people to lose the employer coverage they already have. A recent poll found widespread concern among Americans that their employer will drop coverage because of the law and force them to purchase it on an exchange.

Will you lose your employer coverage under Obamacare? Odds are you won’t

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An often-heard concern about the Affordable Care Act is that is will cause people to lose the employer coverage they already have. A recent poll found widespread concern among Americans that their employer will drop coverage because of the law and force them to purchase it on an exchange.

Early analyses added fuel to these fears. The nonpartisan Congressional Budget Office estimated in 2012 that between three and five million fewer people would obtain coverage through their employer each year between 2019 and 2022. The consulting firm McKinsey and Company predicted in 2011 that 30% of employers would drop coverage.

But if history is a guide, that concern is overblown. In fact, the ACA may have the opposite effect. It may cause the rolls of employer coverage to grow, not shrink.

A recent blog post for the New York Times explains why. The individual mandate, which requires all Americans to maintain health coverage or pay a penalty, may induce many who had previously turned down their employer’s coverage to change course. Many of them may decide not only to sign-up for coverage they had rejected but also to demand that their company keep offering it.

That was the experience in Massachusetts when it implemented a similar system in 2006 under Governor Mitt Romney. The number of companies offering coverage and the number of workers accepting it both increased.

There are early indications that the ACA may be having a similar effect. Several recent surveys indicate that more employees are signing up for the coverage offered through their workplaces since the law took effect.

Of course, the ACA will also increase costs for some employers. And many smaller firms will find it difficult to afford to continue offering coverage, a trend that has been going on for several years.

However, it is clear that the predicted demise of employment-based health insurance under the ACA has yet to begin, and it may never arrive. And factors unrelated to the law, like changes in underlying health care costs, may turn out to be more important in determining health care’s direction.

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Professor, School of Law & Drexel School of Public Health
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The Field Clinic reports and analyzes health care laws, government policies, and political trends that are transforming the care we receive and the way we pay for it. Read more about our panel of bloggers here.

This blog is produced in partnership with Kaiser Health News, an editorially independent program of the Henry J. Kaiser Family Foundation, a nonprofit, nonpartisan health-policy research and communication organization not affiliated with Kaiser Permanente. Portions of this blog may also be found on Inquirer.com and in the Inquirer's Sunday Health Section.

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Robert I. Field, Ph.D., J.D., M.P.H. Professor, School of Law & Drexel School of Public Health
Jeffrey Brenner, MD Founder of the Camden Coalition of Healthcare Providers, Medical Director of the Urban Health Institute at Cooper University Healthcare
Andy Carter President & CEO, The Hospital & Healthsystem Assoc. of Pa.
Robert B. Doherty Senior Vice President of Governmental Affairs & Public Policy American College of Physicians
David Grande, MD, MPA Assistant Professor of Medicine at the University of Pennsylvania
Tine Hansen-Turton Chief Strategy Officer of Public Health Management Corporation
Drew A. Harris, DPM, MPH Director of Health Policy Program at the Jefferson College of Population Health
Antoinette Kraus Director of the Pennsylvania Health Access Network
Laval Miller-Wilson Executive Director of the Pennsylvania Health Law Project
David B. Nash, MD, MBA Founding Dean of the Jefferson College of Population Health
Mark V. Pauly, Ph.D. Professor of Health Care Management, Business Economics and Public Policy at The Wharton School
Howard J. Peterson, MHA Managing Partner of TRG Healthcare, a national healthcare consulting firm
Paula L. Stillman, MD, MBA Healthcare consultant with special expertise in population health and disease management
Elizabeth A. W. Williams Senior Vice President & Chief Communications Officer for Independence Blue Cross
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