30% of health plans to be dropped under Obamacare

Another reason the new national health care bill will have a hard time working:

Once provisions of the Affordable Care Act start to kick in during 2014, at least three of every 10 employers will probably stop offering health coverage, a survey released Monday shows.

While only 7% of employees will be forced to switch to subsidized-exchange programs, at least 30% of companies say they will “definitely or probably” stop offering employer-sponsored coverage, according to the study published in McKinsey Quarterly.

The survey of 1,300 employers says those who are keenly aware of the health-reform measure probably are more likely to consider an alternative to employer-sponsored plans, with 50% to 60% in this group expected to make a change. It also found that for some, it makes more sense to switch.

“At least 30% of employers would gain economically from dropping coverage, even if they completely compensated employees for the change through other benefit offerings or higher salaries,” the study says.

It goes on to add: “Contrary to what employers assume, more than 85% of employees would remain at their jobs even if their employers stopped offering [employer-sponsored insurance], although about 60% would expect increased compensation.”

via Firms to cut health plans as reform starts: survey – MarketWatch.

So if that happens, the Democrats will have no choice but to nationalize the whole thing, if they can.  Or would it be worth it to be paid more money and buy one’s own health insurance, especially if the government makes it cheap?

About Gene Veith

Professor of Literature at Patrick Henry College, the Director of the Cranach Institute at Concordia Theological Seminary, a columnist for World Magazine and TableTalk, and the author of 18 books on different facets of Christianity & Culture.

  • WebMonk

    Technically the title, based on the article, probably ought to be that 30% of employer-provided healthcare plans may be dropped. That’s not quite the same as a 30% drop across the board.

    However, I suspect it is very possible that the non-employer healthcare plans will take an even bigger drop than the employer-provided ones.

    This is something everyone saw coming miles away.

  • WebMonk

    Technically the title, based on the article, probably ought to be that 30% of employer-provided healthcare plans may be dropped. That’s not quite the same as a 30% drop across the board.

    However, I suspect it is very possible that the non-employer healthcare plans will take an even bigger drop than the employer-provided ones.

    This is something everyone saw coming miles away.

  • http://www.bikebubba.blogspot.com bike bubba

    Three in ten plans, but what percentage of workers will lose coverage? And does “will consider” mean “definitely,” or “we’re thinking about it but will back off when the rank and file threaten to unionize?”

    It still illustrates what a bad idea Obamacare was and is, though. The entire thing hinges on the government to “bend the supply curve”, more or less meaning “convince people to practice medicine without being paid.” Mmmmkay…..tell me how that’s worked out in history. Start by finding a decent, affordable apartment in New York City, San Francisco, or Berkeley, and then get back to me, OK?

  • http://www.bikebubba.blogspot.com bike bubba

    Three in ten plans, but what percentage of workers will lose coverage? And does “will consider” mean “definitely,” or “we’re thinking about it but will back off when the rank and file threaten to unionize?”

    It still illustrates what a bad idea Obamacare was and is, though. The entire thing hinges on the government to “bend the supply curve”, more or less meaning “convince people to practice medicine without being paid.” Mmmmkay…..tell me how that’s worked out in history. Start by finding a decent, affordable apartment in New York City, San Francisco, or Berkeley, and then get back to me, OK?

  • http://facebook.com/mesamike Mike Westfall

    What we need is a good shot of Dr. Utopia’s ISM . That’ll fix everything.

  • http://facebook.com/mesamike Mike Westfall

    What we need is a good shot of Dr. Utopia’s ISM . That’ll fix everything.

  • DonS

    Many believe that this was the objective when the Obamacare package was passed.

  • DonS

    Many believe that this was the objective when the Obamacare package was passed.

  • Jimmy Veith

    It is certainly difficult to predict the future, especially when it hasn’t happened yet.

    The survey results are most likely an indication as to the success of fear mongering perpetuated by the health insurance industry rather than a predictor as to what will actually occur.

    In 2006, Massachusetts passed health care reform with an individual mandate, from which the Affordable Care Act was modeled. I think the experience of Massachusetts is a better predictor of what will happen when the federal law goes into full effect. So far, it seems to be working fairly well as Massachusetts has the lowest rate of uninsured in the nation at 2.6% as of May 2009.

    More needs to be done to control health care costs. However, the idea that employers will drop health insurance coverage for their employees in mass as a result of health insurance reform is unlikely. At least, it did not happen in Massachusetts.

  • Jimmy Veith

    It is certainly difficult to predict the future, especially when it hasn’t happened yet.

    The survey results are most likely an indication as to the success of fear mongering perpetuated by the health insurance industry rather than a predictor as to what will actually occur.

    In 2006, Massachusetts passed health care reform with an individual mandate, from which the Affordable Care Act was modeled. I think the experience of Massachusetts is a better predictor of what will happen when the federal law goes into full effect. So far, it seems to be working fairly well as Massachusetts has the lowest rate of uninsured in the nation at 2.6% as of May 2009.

    More needs to be done to control health care costs. However, the idea that employers will drop health insurance coverage for their employees in mass as a result of health insurance reform is unlikely. At least, it did not happen in Massachusetts.

  • http://www.bikebubba.blogspot.com bike bubba

    Romneycare isn’t that good, starting with half a billion in fees (taxes by any other name) and $140 million in business tax hikes to fund it, and the program has required more tax hikes to cover the cost overruns.

    So yes, Massachusetts is a predictor of what will happen when the full impact of Obamacare is realized, and that’s not pretty. It’s rather what one would anticipate when people don’t see the cost of the goods and services they’re getting; sky high demand and constricted supply. In other words, the same kind of thing that gets people killed routinely in Britain’s NHS.

  • http://www.bikebubba.blogspot.com bike bubba

    Romneycare isn’t that good, starting with half a billion in fees (taxes by any other name) and $140 million in business tax hikes to fund it, and the program has required more tax hikes to cover the cost overruns.

    So yes, Massachusetts is a predictor of what will happen when the full impact of Obamacare is realized, and that’s not pretty. It’s rather what one would anticipate when people don’t see the cost of the goods and services they’re getting; sky high demand and constricted supply. In other words, the same kind of thing that gets people killed routinely in Britain’s NHS.


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