Another Obamacare Lie

HHS official: Employers may gradually move to exchanges



By Jason Millman – 03/29/11 11:42 AM ET

Big companies may eventually look to dump their employees onto new state-run health insurance markets in the future if a key aspect of healthcare reform turns out to be successful, an Obama administration health official predicted Tuesday morning. 

Starting in 2014, millions of individuals are expected to purchase insurance through new state health insurance exchanges, which are supposed to offer more affordable and quality coverage. But comments from some large employers have sparked fears that major corporations will eliminate health insurance when the exchanges open, adding an unanticipated burden of millions more onto the new markets. 

Firms with 50 or more employees face penalties in 2014 if they don’t offer minimum essential health coverage to their employees, but many think that the penalties will be cheaper than actually offering health coverage. 

“Congress estimated that as many as four million people would move from employer-provided care to the exchanges,” the HR Policy Association wrote to state governors on Monday. “We believe, however, Congress may have significantly underestimated the shift to exchange-based care that will result from the new law.”

Joel Ario, who oversees the exchanges for the Department of Health and Human Services, said fears about the blow to the employer-sponsored health system have been overstated. In the interest of remaining competitive, major employers won’t drop their health insurance right away, Ario said.

“They’ll continue to provide it, and we may wind up with an employer-based system for a long time because exchanges may not develop,” Ario said.

However, if the exchanges prove to be a source for better and cheaper coverage, then employers will be incentivized to scrap their health plans.

“If it plays out the exchanges work pretty well, then the employer can say ‘This is a great thing. I can now dump my people into the exchange and it would be good for them, good for me,' ” Ario continued.



So much for, if you like the plan you have you can keep it . . .

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