Employers Support Measures To Provide Health Care Coverage
U.S. employers of all sizes recognize the value of offering health care benefits in attracting and retaining workers; however, smaller employers would like coverage to become more affordable, and larger employers want improvements in quality and reductions in administrative costs, according to a study published in the November/December 2006 issue of Health Affairs.
The study, "Employers' View On Incremental Measures To Expand Health Coverage," was written by Sara R. Collins of the Commonwealth Fund, and Heidi Whitmore, Jon Gabel, and Jeremy Pickreign of the Center for Studying Health System Change (HSC). The findings were based on the 2005 annual Survey of Employer-Sponsored Health Benefits conducted by the Henry J. Kaiser Family Foundation and the Health Research and Educational Trust, data on employers' views of policy strategy from the Commonwealth Fund, and a survey of 2,995 randomly selected employers.
When asked to assess the value of offering health care benefits, 93% of the employers surveyed agreed that medical coverage is important in retaining qualified employees, and 91% said it is important in attracting qualified employees. In addition, 78% of respondents rated providing health benefits as important in improving employees' performance, 94% agreed it plays a significant role in improving employees' health, and 95% said it is important in improving employees' morale. Large firms (200 or more employees) were found to be only slightly more likely than small firms (between 3 and 199 employees) to place importance on providing health care benefits.
The authors observed that the study's findings reveal "an employer community that continues to maintain a sense of responsibility for the provision of health insurance to its employees. Rather than running for the exits, as they are often portrayed in the media, companies that offer coverage hold a positive view of health benefits, both in their role in attracting and retaining highly qualified employees and also in improving the health and performance of their workforces."
However, the authors noted, "employers also appear sensitive to the externalities of free-riding among their colleagues that do not offer coverage." The study found that among all firms, including those that do not currently offer health benefits, two-thirds strongly or somewhat agreed with the statement that "all employers should share in the cost of health insurance for employees, either by covering their own workers or by contributing to a fund to cover the uninsured." Small firms were found to be as likely as large firms to hold this view.
Researchers also asked employers about their willingness to support health insurance reform that would require administrative action on their part. Results showed that 90% are willing to provide eligible low-income employees with information about how to apply for government-administered health programs, 72% are amenable to assisting employees in enrolling in government-sponsored programs by making payroll deductions to the state for premiums, 81% are willing to reduce an eligible employee's withholding tax by the amount of any available tax credit, and 70% are prepared to collect a tax credit and apply it to the employee's share of the premium. However, just 46% said they are willing to support legislation that would provide federal premium assistance to former workers who elect COBRA coverage if employers are obligated to help administer the plan. Small companies tend to be more open to these administrative reforms than large companies.
Employers were found to be somewhat less interested in participating in reform options requiring financial support. The survey showed that 51% of firms are interested in contributing to a premium that would allow their workers to enroll in a federal or state health plan for public employees, 51% would consider contributing a portion of the premium for their workers who enroll in public health insurance plan, and 63% believe it is important that the federal government offer reinsurance to protect employers from liability for catastrophic health care costs above a certain amount, even if employers are required to pick up some of the costs.
When asked which of five possible strategies they believe would be most beneficial in reducing administrative costs associated with providing health benefits for employers, insurers, and providers, 22% of the employers surveyed chose the establishment of universal quality performance standards for providers, 21% cited standardization of health benefits, 18% selected standardization of payment methods, 17% said joint purchasing of health benefits by employers, and 15% chose joint purchasing of health benefits by employers and public insurance programs.
