A slim majority of 1,400 surveyed employers of various sizes expect to continue their group medical plans when online state insurance exchanges become operational in 2014, even if the exchanges offer competitively priced rates. Many of the employers were undecided.

The insurance exchanges are mandated under the Accountable Care Act (health care reform). New York-based Willis Group Holdings, an insurance broker, conducted the survey with help from Diamond Management & Technology Consultants Inc., Chicago. While 52% of respondents expect to maintain their coverage, 33% aren't sure and 12% are somewhat or not at all likely to continue coverage.

Of those employers who may terminate their coverage and direct employees to an insurance exchange, 16% appear likely to provide no increase in employee compensation. Another 17% appear likely to increase their compensation to reflect employer-saved costs. But at least 40% don't yet know what they will do if they terminate coverage.

Sixty-two percent of surveyed employees showed a desire to invest in employer-sponsored coverage and avoid a $2,000 penalty per employee. But 30% don't know what they will do.

Other survey results include:

* 88% of responding employers believe group health plan costs will increase because of health care reform mandates and 76% think administrative compliance costs will rise;

* 72% plan to increase employee contributions to offset the affect of higher costs, and employers in general indicated they might use other actions, such as decreasing or eliminating ancillary benefits;

* 53% expect the adult child coverage mandate, which is effective for most plans by Jan. 1, 2011, to increase their plan costs by at least 1%

* More than half of surveyed employers do not fully understand the availability and eligibility of wellness and small business tax credits

* 52% anticipate an increase in the number of employees covered under employer-sponsored benefit plans.

More information and a link to the report, "Health Care Reform Survey 2010," are available here.

This story has been reprinted with permission from Health Data Management.

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