What will Obamacare mean for American businesses? Higher costs, according to a report released yesterday from consultants at Mercer.
Here are the preliminary results from Mercer’s annual survey of large employers about the impact of Obamacare:
Costs Continue to Rise: Despite the moderating effects of the recession in dampening consumer demand, “employers expect health benefit cost per employee will rise by 4.8 percent on average in 2014.” Recall that then-Senator Obama promised in 2008 that his health plan would lower health costs by an average of $2,500 per family.
Obamacare’s Mandates Hitting Many Businesses: “About a third of all large employer health plan sponsors (those with 500 or more employees) do not currently offer coverage to all employees working 30 or more hours per week, as will be required under the [law] beginning in 2015. Industries that rely heavily on part-time workers will be the hardest hit by this rule. About half of respondents in retail and hospitality currently do not offer coverage to all employees working 30 or more hours per week.”
Obamacare Will Raise Costs by at Least 2 Percent for Majority of Firms: “When asked to consider the impact of higher enrollment and new [Obamacare] fees…about half of the employers surveyed say they will spend at least 2% more on health benefits in 2014 – over and above the normal increase in cost. Another third are unable to predict. Only about a fifth of employers are confident that [Obamacare] will have little or no impact on spending in 2014.” The Mercer consultants also pointed out that Obamacare could impose additional costs on businesses once the delayed employer mandate takes effect in 2015.
More Workers Will See Their Hours Cut: “Some employers will minimize the number of newly eligible employees by cutting back on hours for at least a portion of their workforce – 11% of all large employers say they will do so.”