Employer Health Care Reform: What's First, The Chicken Or The Egg?
The era of government involvement in the private employer health care marketplace has begun, with implications for organizations of all shapes and sizes. Understanding the impacts of this significant shift will require smart first steps and deliberate processes. Should companies focus first on technical considerations related to actuarial and employee benefits, or is it better to begin with an emphasis on workforce planning? The big driver of this legislation is insurance reform, with employer's likely facing requirements for minimum standards of coverage. That shifts the entire benefits playing field. Changes in employer plans are inevitable. For most large employers, the changes will be minor and many employer plans will be grandfathered in. Besides, the effective date for compliance will be ten years away in some cases. Why worry about this now? As a practical matter, reform is likely to add to the cost burden for employers. If you're going to get serious about controlling benefits costs, it's time to get started. That requires a sharp focus on the technical details. Sure you need to control costs - what else is new? But changing your benefits plans prematurely could put your grandfathered status at risk. This is a time to move carefully. Health care reform could extend coverage to virtually all full-time employees. Companies with large numbers of part-time and contract workers will need to analyze the new coverage rules, understand the cost impacts and consider rethinking their staffing models. This may be a big deal for some industries like retail or hospitality, but most companies don't need to worry about it at all.