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Brace for employer plan changes

By Jay MacDonald ·
Tuesday, September 24, 2013
Posted: 6 am ET

Technically, President Barack Obama was telling the truth back in 2010 when he told Americans who had employer-sponsored health insurance that they would be able to keep their plan when his health reform law was fully implemented.

What he didn't mention, of course, is that your employer plan is likely to change as a result of the widespread reforms of Obamacare, whether you like it or not.

Changes afoot

As the new state health marketplaces prepare to serve those without employer-sponsored coverage, Aon Hewitt urges those with employer group plans to keep an eye out for these likely plan changes during the coming open enrollment season:

  • Higher costs. Aon Hewitt says its research shows that most employers plan to subsidize their group plans at the same percentage rate as last year. As a result, employees can expect to pay most of the increasing cost of health care out of their paycheck. In addition, nearly 1 in 5 employers has increased surcharges for spouses or other adult dependents who have access to other health insurance.
  • Shift to consumer-driven health plans, or CDHPs. More and more employers are switching to CDHPs, in which they simply give employees cash through a health reimbursement or savings account with which to shop for their own policy, sometimes on a private exchange. Aon Hewitt says CDHPs have not only surpassed health maintenance organizations, or HMOs, as the second most popular plan offering but are the only plans now offered by a growing number of employers. While just 10 percent of employers offer CDHPs today, 44 percent are considering moving to them in the next three to five years, according to Aon Hewitt.
  • Greater plan choices. Some employees who are not offered coverage through their company may qualify to purchase health insurance on the new state marketplaces. In addition, the recent U.S. Supreme Court ruling on same-sex marriage may make more dependents eligible for coverage under their partner's group plan.
  • Wellness programs 2.0. In what might be termed wellness programs on steroids, expect a growing number of employers to offer financial incentives for healthy behaviors and penalties for tobacco use or other risky behaviors. Aon Hewitt surveys show that 71 percent of employers now offer screenings for things like blood pressure and cholesterol, 75 percent offer health risk questionnaires, and 83 percent have incentives in place to promote the use of wellness programs by employees.

How to get ready

How can employees avoid being blindsided by these plan twists? Aon Hewitt says prepare yourself for open enrollment by: understanding your options and deadlines; researching the pros and cons of CDHPs; reviewing how you and your family use health care; and considering supplemental coverage, such as critical illness and hospital indemnity, which may be less expensive through your employer.

And, for the first time, familiarize yourself with health insurance options and rates on your state's new marketplace. While you may not be eligible to buy a marketplace policy if your employer offers you a plan that meets the federal cost and coverage minimums, some workers may be able to decline substandard coverage and pursue a marketplace policy instead.

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Jay MacDonald is a Bankrate contributing editor and co-author of "Future Millionaires' Guidebook," an e-book by Bankrate editors and reporters.

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September 24, 2013 at 10:06 am



He lied.