Will Employers Drop Coverage?

[ABC]

To be a successful producer you are going to have to be everything to everyone when it comes to health insurance.

If we are able to be compensated on the federal exchange we are gold. If we are not our gig may be up.

The exchange is going to have narrow networks. It may mirror an HMO. There is a segment of the population that will not go for that. These will be people with means.They will buy a policy outside of the exchange because they don't qualify for subsidies in the first place.

I believe the carriers will stay pay us but you will have to consistent. They days of sitting on a block of biz will come to an end.

Our lively hood depends on comp from the federal exchange.

 

[leevena]

Here is the other question I haven't seen answered.

Is it a tax, a fine or a penalty to the employer for not having coverage? If it is a tax, it will be deductible and you can be sure they will be dropping plans left and right. If it is a fine or penalty I don't believe they can deduct it, but the savings may be so big the company still comes out ahead by dropping the plan.

Penalty is not tax deductible.

Question about dropping is a little more complex. The employer will drop the coverage and save the premium. Now the employees go to the exchange, and some will find it fairly expensive, maybe even those who get a subsidy. Now the blow-back to the employer starts. I don't know the answer, but it will be interesting.

 

[Yagents]

Man, this is all good stuff, great banter.

I love the point by Ann about a trickle effect on dropping coverage, it will present opps outside of OE.

I love the idea of american companies getting out of the health insurance business, we will be competitive again, and create jobs. GI will also inspire entrepeneurs to start up their own biz.

 

[stuy119]

Penalty is not tax deductible.

Question about dropping is a little more complex. The employer will drop the coverage and save the premium. Now the employees go to the exchange, and some will find it fairly expensive, maybe even those who get a subsidy. Now the blow-back to the employer starts. I don't know the answer, but it will be interesting.

The blowback will depend on how much the ER was contributing previously. If the ER was between 50-75% contribution, the EE has no idea how expensive health insurance is, other than the portion they pay - and they'll be shocked (even with subsidies) when they go out to buy their own plan.

THAT is where the blowback will occur. If the ER is only putting in 25%, it might not be as shocking of a situation.
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I love the idea of american companies getting out of the health insurance business, we will be competitive again, and create jobs. GI will also inspire entrepeneurs to start up their own biz.

I agree with the second sentence.

The first sentence is going to develop a business culture of the "have's" and the "have-nots" which is even more divided than it is now. Companies that will provide great benefits will continue to get the top-tier talent, while companies that don't will fall further and further behind, and be required to sell on price rather than ingenuity.

It's going to be an interesting period of time over the next 20 years or so.

 

[Yagents]

EE's will know as of tomorrow when they get their W-2, as the value of the group health insurance premiums is now required on the form (non taxable). Prepping the blind sheep.

 

[taterpeeler]

EE's will know as of tomorrow when they get their W-2, as the value of the group health insurance premiums is now required on the form (non taxable). Prepping the blind sheep.

it is required on last years 2012 w-2 if so let me look at my wifes, I have it here I think

edited... holy chit batman... 20K

 

[Ann H]

it is required on last years 2012 w-2 if so let me look at my wifes, I have it here I think

edited... holy chit batman... 20K

Observation #1 - most people don't read their W2

Observation #2 - most people don't realize how much money their employer has been paying for their health insurance.

Observation #3 - Tater says chit a lot

 

[leevena]

Observation #1 - most people don't read their W2

Observation #2 - most people don't realize how much money their employer has been paying for their health insurance.

Observation #3 - Tater says chit a lot

I agree. Even if they read or hear the number, they will not react well when they get to the exchange. Over the holidays a friend asked me about his cobra costs ($2000 per month for him and wife) becasue he thought it was wrong. He is about 60, more than well to do financially, and retired from a senior position in a very larger firm. I can't wait for the less well to do, less informed people to hit the exchanges, even with subsidies, there will be a lot of growling.

 

[Ann H]

My Uncle worked most of his life for a very large local Utility company, and he bragged to me, "Ann, look at the benefits I have! And my premium is only $58 a month." I said, "No, your portion of the premium is $58. Your employer is paying about $500 a month just for you, and another $800 monthly for your family." "No," he insisted, "The premium is $58 a month. That's why I keep working for a large company, because they can negotiate these low rates for great benefits." No amount of reasoning would help him see the truth.

 

[insuranceconceptscindy]

My Uncle worked most of his life for a very large local Utility company, and he bragged to me, "Ann, look at the benefits I have! And my premium is only $58 a month." I said, "No, your portion of the premium is $58. Your employer is paying about $500 a month just for you, and another $800 monthly for your family." "No," he insisted, "The premium is $58 a month. That's why I keep working for a large company, because they can negotiate these low rates for great benefits." No amount of reasoning would help him see the truth.

I wish more employers were up front with the costs to their employees. It shouldn't be a secret, especially if the employee is paying part of the cost.
My husband works for a large, nationwide company- they were completely up front during renewal- "it's going to cost X amount for us and X amount for you. We suggest you use the preventive services available to you (read:lose weight and quit smoking!) and be mindful of the cost, because it will continue to increase."
Education is so important! If we don't give our clients and their employees the full picture, they will end up like your uncle, who thinks health insurance costs $58!