Tuesday, August 10. 2010Many companies predict losing 'grandfathered' status
Under healthcare reform, companies can earn "grandfathered" status, which allows them to keep many of their health care coverage provisions and lightens the amount of changes needed to be in compliance with the law.
However, 90 percent of companies say they believe they will lose their grandfathered status, according to a study by Hewitt Associates. A company can lose the status for several reasons, including raising deductibles or changing insurance companies. "Employers reviewing their existing health care strategies in light of reform are focused on answering two questions: What changes do I need or want to make to my health care plans? And how can I make them without significantly increasing costs? said Hewitt's Health Management practice leader Ken Sperling. Over 70 percent of companies surveyed said that they think they will lose grandfathered status because of plan design changes and almost 40 percent cited subsidy level changes as a reason for losing the status. Kiplinger reports that a large number of companies will push the additional healthcare cost burden on their employees by raising premiums and co-payments.
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