Picturing Life Without the Employer Mandate

Picturing Life Without the Employer Mandate

Our Thinking / Healthcare /

Picturing Life Without the Employer Mandate
Calendar25 May 2017

Earlier this week, we hosted a Mercer Select Briefing and asked participants to ponder changes they might make to their health benefits if the ACA’s employer mandate were fully or partially repealed. Of the 175 employers taking the poll, relatively few anticipate making any particular change. The largest number of respondents – 21% – said they would be likely to set higher employee contributions for individual coverage than currently permitted under the affordability requirement. Given that many employers have added lower-cost plans since the ACA was signed, most don’t have an issue with affordable contributions. Just 19% said they would be likely to resume a 40-hour work-week requirement for eligibility (rather than the 30-hour requirement under the ACA) and the same percentage said they would likely revisit lifetime benefit dollar limits. Fewer than one in ten employers thought they might impose pre-existing condition limitations, and almost none said they were likely to require more than a 90-day waiting period for benefits. 

The truth is, in employer-sponsored plans the burden of compliance was greater than the impact of compliance. Now that we are there, it is unlikely there will be a race to unravel the changes. Probably the two biggest ACA issues for employers that remain are the excise tax (delayed until 2020) and the ongoing reporting requirements. The current version of the AHCA further delays the excise tax, and regulators are well aware of employers’ desire for relief around reporting. We keep hearing that change is coming, but change takes time in Washington DC.

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