Key provisions of the Patient Protection and Affordable Care Act (PPACA) will go into effect in 2013 and 2014, and many employers will struggle to implement the requirements of the law. The still-evolving changes of health care reform will require a re-evaluation of benefit strategies. New taxes, penalties, mandates, and administrative requirements will add to benefit costs. Therefore, it is important for employers to develop a long-term health care strategy and to understand and analyze how PPACA will impact their business.
In addition to implementing PPACA, containing health care costs will continue to be important for employers in 2013 as they face the ongoing struggle of providing adequate benefits while keeping costs low. In recent years, there has been slower growth in health care costs due to trends aimed at keeping cost increases in check. Even as the economy strengthens, changes in behavior by employers and employees may help limit medical expense growth.
In 2013, as in the recent past, employees are taking on a larger share of health care expenses. As employers shift expenses to their employees, these workers are pursuing lower-cost alternatives. The number of consumer-driven high deductible (CDHD) plans, coupled with Health Savings Accounts (HSAs) or, to a lesser extent, Health Reimbursement Accounts (HRAs), will continue to increase as a result.
Additionally, the use of wellness plans will continue to increase, as this strategy is linked to more health-conscious behavior. With wellness programs, employees have a greater sense of accountability. As a part of these programs, employers are educating employees to become more informed health care consumers, as health care costs remain a significant expense for most people. This education, coupled with financial or nonfinancial incentives, is causing more employers to rely on wellness programs as a way to manage health care costs.
In 2013 and beyond, understanding the impact of PPACA while continuing to manage healthcare costs is key.
Mary-Ann F. Schaller can be reached at Email or 215.441.4600.