Most employers expect health care costs to increase under Obamacare

LOS ANGELES — More than 60 percent of employers in a new survey anticipate some increase in their health benefit costs because of the federal Affordable Care Act.

The survey of 1,203 employers by the Mercer consulting firm found that 20 percent of those businesses expect an increase of 5 percent or more.

The firm said employers in retail and hospitality, which often have large numbers of part-time and lower-paid workers, will be among those most affected when the health care law takes full effect in 2014. Employers will be required to extend coverage to all employees working 30 hours or more per week or face possible penalties, according to Mercer.

“Extending coverage to more employees will be a significant new expense for these employers,” said Tracy Watts, Mercer’s U.S. health care reform leader, “especially because other provisions (of the law) regulate how much an employer can require employees to contribute to the cost and how good the coverage must be.”

Overall, 6 percent of employers surveyed said they were likely to stop providing health benefits after government-run insurance exchanges open in 2014. That rose to 9 percent among retail and hospitality employers.

Many employers, large and small, are rethinking their health care strategies in the face of escalating health premiums and new requirements under the federal law.

Some businesses are opting for smaller networks of doctors and hospitals that restrict workers’ choices and require employees to pay more to see higher-cost medical providers. Other employers are arranging for teams of doctors and nurses to focus more attention on high-cost patients suffering from multiple chronic conditions.

“While there are a number of potentially valuable cost-containment elements of the Affordable Care Act, the reality is unless something more is done there will still be upward pressure on health care costs,” said Bill Kramer, executive director for national health policy at the Pacific Business Group on Health, a nonprofit coalition that includes large employers such as Boeing Co. and Walt Disney Co.

Kramer said “the unfinished business of health reform is cost containment.”

&Copy;2012 Los Angeles Times

Visit the Los Angeles Times at

Distributed by MCT Information Services

More in Herald Business Journal

Peoples, HomeStreet banks bump lowest salaries after tax cut

The banks with Snohomish County branches will raise minimum salaries for employees to $15 an hour.

Electroimpact cuts Mukilteo staff by 9 percent

“What we’re missing now is a monster anchor project,” the company’s VP said.

Exotic animals find compassionate care in Bothell (video)

At the Center for Bird and Exotic Animal Medicine, vets treat snakes, hedgehogs and even kangaroos.

How can you tell if you are getting good financial advice?

Assume that it’s still the same buyer-beware market that has always existed.

Amanda Strong (left) tries on an Angel of the Winds Arena hat as she and Courtney Brown hand out gift bags after the renaming ceremony Dec. 13 in Everett. The new name replaces the Xfinity name. (Andy Bronson / Her file)
Angel of the Winds to break ground on $60M casino expansion

“We think we’re on the cusp of becoming a major resort.”

In this Dec. 20, 2017, photo, a clerk reaches to a shelf to pick an item for a customer order at the Amazon Prime warehouse, in New York. (AP Photo/Mark Lennihan, File)
Amazon’s potential HQ2 sites leaves many cities disappointed

And yet, some municipal leaders are looking at the bright side of being rejected.

How do you retrieve an errant Boeing 737 from a muddy slope?

Turkish authorities used cranes to lift a plane that skidded off a runway.

Don’t take economic forecasts to the bank — or the casino

Air travel delays could spur a rebirth of passenger rail service.

Emirates orders 20 more Airbus A380 jumbos, saving program

The Dubai carrier also has options to buy 16 more. The program seems safe until 2029.

Most Read