Kaiser recently released the results of its thirteenth annual Kaiser Family Foundation/Health Research & Educational Trust (HRET) Employer Health Benefits survey. Each year they conduct a survey of 3,184 “nonfederal private and public employers with three or more workers.”

This survey looks at many employer-sponsored health coverage trends including premiums, employee contributions, cost-sharing and much more. New for 2011 it also includes, “the percent of firms with grandfathered health plans, changes in benefits for preventive care, enrollment of adult children due to the new health reform law, and the use of stoploss coverage by firms with self-funded plans.”

The findings in this year’s survey show that the percentage of large employers (those with 200 or more workers) offering retiree health benefits in 2011 is 26%, which is the same percentage that was offered in 2010. The steep decline in employers offering retiree benefits seems to have moderated in recent years, and reached a plateau at least for the time being.

Here are a few key findings:

  • 26% of large employers are offering retiree Health benefits – no change from last year.
  • 72% of all firms have at least one grandfathered plan under ACA.
  • 65% of small businesses haven’t checked to see if they qualify for ACA small employer tax credits.
  • 56% of covered workers are in grandfathered plans.

You can access the survey online at http://ehbs.kff.org. You read the report online, or down load the full report, a summary, and presentation slides as well as various other documents and supplements.

Visit Extend Health — the nation’s largest private Medicare exchange.

Towers Watson, a global professional services company, surveyed 368 midsize to large companies and found that “employers are planning only moderate changes in their health care plans for 2012.”
In addition, even though health costs are expected to rise 5.9% in 2012 compared to 7.6% in 2011, most employers will be working to control costs and avoid the excise tax. Almost half will change their health care strategy in 2012, and many are not sure how they will react to state-run insurance exchanges coming in 2014.

Some of the actions that employers are considering between now and 2014 include account-based health plan (ABHP) increases, value-based benefit designs, and increased usage of preferred networks. Additional changes under consideration for 2014 and 2015 include reductions to health care benefit values for active employees and employee healthcare contributions for lower-paid workers.

Here are a few more highlights from the survey results:

  • 71% will definitely continue offering health care coverage through 2014
  • 29% are not sure whether they will continue sponsorship or increase salaries to make up for any loss of employer-provided health care benefits
  • 53% believe “health care reform will be implemented within the anticipated timeline”
  • 70% are doubtful state-run insurance exchanges will be a viable alternative in 2014 or 2015

One statistic in the Towers Watson study that we found particularly interesting is the high percentage of employers (54%) that plan to discontinue health care benefits for pre-65 and post-65 retirees. We believe that public and private exchanges will provide a viable alternative for early retirees and a sustainable way for employers to continue to offer benefits to these individuals. Just as our employer clients today are able to control the cost of health care benefits for post-65 retirees with a defined contribution subsidy, the same model will work for early retirees starting in 2014 when all insurance is guaranteed issue.

Much is still unknown about the impact health care reform will have in the short- and long-term, which is why, “most employers will not make wholesale changes to employer-sponsored health plans in 2012,” said Ron Fontanetta, senior health care consulting leader at Towers Watson. “However, a small group of employers is driving more fundamental change in 2012 by using account-based platform designs, aggressively positioning incentives and rethinking subsidization levels.”

For more survey details and a snapshot of health care costs in 2012 visit Towers Watson.

Visit Extend Health — the nation’s largest private Medicare exchange.

Extend Health CEO Bryce Williams has written a new piece just published on the Society for Human Resource Management Web site. Bryce is known around here not only for his deep knowledge of health care insurance, but for constantly thinking about ways we can empower employers to provide affordable health care benefits to their employees. This new article offers some sage advice for employers who want to continue to offer early retiree benefits but need to control their costs. The key? Start moving them to defined contribution plans now:

“Until 2014, can early retirees be helped? The answer is yes: by beginning to move them from legacy group plans to ‘defined contribution health plans’ and providing education and tools, HR managers can empower their early retirees to become cost-conscious and careful consumers, changing their mindset from ‘I don’t know how much my health benefits cost and I don’t care’ to ‘I know how much my health benefits costs and I do care.'”

The article outlines a roadmap for supporting early retirees through the transition from group plans to individual plans purchased on the coming state insurance exchanges, with advice for the kind of programs and education that will help this vulnerable population become “empowered individual health insurance consumers” — while at the same time giving employers the ability to plan, predict, and control costs.

The state of Nevada will work with Extend Health to move Medicare-eligible retired government workers from group Medicare insurance to private coverage. In the process, the state expects to save $8 million and retirees will pay less for their Medicare gap insurance.

“By purchasing individual plans on a health insurance exchange, retirees will have more choice and control over their health care coverage, and the opportunity to select plans that are right for them,” according to James Wells, executive director of the Nevada Public Employees Benefit Program.

You can read more about the state’s decision in this Bloomberg Business Week article.

A very interesting chart just posted on the Kaiser Health News site shows that the percent of large employers offering retiree health benefits is at its lowest point ever in 2010. You can also view a whole lot of other interesting data from this page, if you’re interested in knowing more about the state of retiree health care benefits.

Towers Watson this week published results of a new survey  on attitudes toward retirement risk. The survey of nearly 9,100 employees shows that 4 in 10 U.S. workers are planning to delay retirement. One telling finding: a large majorty of respondents said they would be willing to pay more now for greater certainty in their future benefits. From the press release summarizing the results:

“The survey, conducted in May and June of 2010, found that 40% of workers are planning to retire later than they were two years ago. Older workers and those in poor health comprise the largest percentage of employees planning to delay retirement. In particular, 45% of employees in poor health plan to postpone their retirement. When asked why they are choosing to retire later, more than two-thirds (68%) of older workers said to keep their health care coverage, while 62% said the higher cost of health care. Six in 10 older workers (61%) blamed the decline in the value of their 401(k) plan.”

If you haven’t seen it already, the National Business Group on Health has just released results of its latest polling on health care benefit trends among large employers. One of the most interesting findings: a majority of employers (61%) will offer a consumer-directed health care plan (CDHP) in 2011. More and more employers are looking at CDHP strategies as a way to hold down their health care benefit costs. At Extend Health, we know it works because we’ve seen our clients reduce their health care spending, administrative costs, and long-term OPEB liabilities for retiree benefits by transitioning their Medicare-eligible retirees to individual Medicare accounts subsidized by HRA accounts.

The full survey is available for download here.

Over at Employee Benefit News, Lydell C. Bridgeford has done a nice job of summarizing the findings from the latest MetLife Employee Benefits Trends Survey. Key takeaways: for the first time since the survey began eight years ago, employers’ biggest concern is controlling the cost of heath and welfare benefits, coming in ahead of employee retention and increasing employee productivity. Employees are worried about the cost of health care too – and want to know how to get the most out of their benefit plans.

The Pew Center on the States published an eye-opening report earlier this year. “The Trillion Dollar Gap,” examines the gap that exists between the $2.3 trillion participating localities have set aside to pay for employees’ retirement benefits and the $3.3 trillion price tag of those promises. Read the rest of this entry »