ACA Will Remain Focal Point for CEOs in 2015 and Beyond | Mercer US

ACA Will Remain Focal Point for CEOs in 2015 and Beyond

Our Thinking / Healthcare /

ACA Will Remain Focal Point for CEOs in 2015 and Beyond
Calendar05 January 2015



As the CEO of a large corporation, I understand the role that health care benefits play in organizational success. A business fundamental is to manage operational costs so that you can continue to provide your products and services at a price that your customers will pay, and health benefits are a significant cost which must be addressed. At the same time, health benefits are critical to our ability to attract, retain and develop top talent.



And as the CEO of a global benefit consultancy, I believe it’s critical for my peers to recognize that the Affordable Care Act (ACA) will profoundly change the health benefits employees are offered. There are many ways to respond to the ACA, but doing nothing is no longer an option. First is to recognize that the law will not go away. The Supreme Court challenges and the shift in the make-up of Congress will create bumps in the road, but even critics recognize that repealing this landmark legislation is a political hot potato, since there are now millions of people in public exchanges and many others who are benefitting by some of the more popular aspects of the ACA, such as eliminating pre-existing condition exclusions. That’s not to say that the law can’t be improved. Employers can and should play a role in the ongoing process to identify and address the problem areas.

While many of the ACA’s provisions are already in place, no employer can afford to ignore the excise tax on high-cost plans approaching in 2018. There is no single solution that will work for every company. What course of action you choose will depend on your situation, and in particular the make-up of the employee population. For example, employers with a mix of high-income and low-income employees will need to address their diverse needs. Companies that have already addressed long-term health benefit cost management — as well as the shorter-term compliance and reporting requirements — will have less to do than companies that are just getting started.

The key to accomplishing corporate objectives in a changing benefits landscape is pursuing a strategy that will bend the curve on health benefit costs while remaining mindful that health benefits have a direct correlation to company loyalty and productivity. Companies that view providing health benefits as part of a long-term solution to their employees’ needs are more likely to win the talent war and outperform their competitors.

Mercer has assembled a panel of experts to reflect on key health care reform developments and share their expectations for the future. Julio A. Portalatin is President and CEO of Mercer.

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