Article 3 in the ACA Cost Mitigation series
While governmental employers prepare their 2014 health insurance plans to comply with the Affordable Care Act (ACA), one thing about healthcare reform is becoming abundantly clear: Providing affordable coverage to the newly-defined full-time employee will increase employer costs.
Counter measures to combat cost increases will inevitably involve changes to your plan. As part of our cost mitigation series, this article will cover Redistribution of Employer Premium Contributions as one such strategy.
Spousal Coverage Not Mandated
Under ACA, you are obligated to offer coverage to your employees and dependent children, and make employee-only coverage affordable, but there are no mandates requiring spousal coverage.
Spousal Access to Coverage
Statistics show that up to 66% of married couples have dual incomes. Therefore many spouses will have access to affordable plans through their own employment. And for those who are not employed, they will soon have access to health plans through the State or Federal Health Insurance Marketplaces (formerly known as Exchanges). Non-working spouses without access to coverage may even qualify for subsidies such as a premium tax credit and cost-sharing assistance.
One way that employers can mitigate the costs under ACA is by redistributing employer premium contributions toward employee-only coverage and away from spousal coverage.
Don’t reinvent your health plan every year
Insurance brokers who visit only at renewal time just to take you out to bid yet again are doing you a disservice. Instead, look for agents who partner with you throughout the year and can help you establish a 3-5 year ACA compliant cost-reduction plan.
Crawl. Walk. Run.
Developing a strategic plan doesn’t have to be an overwhelming process, as the early-adopters have already paved the way. The idea is to introduce change slowly, upping the ante every year, to help employees improve health and reduce costs.
For more information on Spousal Carve-Outs, please contact Bill Enright.