Employers Expect Court to Save Some of Health Reform Law

By SHRM Online staff Jun 7, 2012

Two-thirds of employers think that the U.S. Supreme Court will overturn the individual coverage mandate in the Patient Protection and Affordable Care Act (PPACA), which was signed into law March 2010, but that the court will keep other major pieces of reform intact. The survey was conducted in May 2012 by the International Foundation of Employee Benefit Plans (IFEBP).

The remaining respondents are split: 19 percent predict that the court will keep the law intact, and 15 percent expect the court to throw out the entire law.

The Wisconsin-based nonprofit’s findings were released June 5, 2012. Responses were received from 1,027 plan administrators, trustees and organizational representatives from single-employers, corporations, multiemployer trust funds and public/governmental employers.

The high court is expected to release its decision near the end of June 2012.

The case focuses primarily on the mandate that individuals purchase health care coverage and secondarily on a provision requiring states to provide expanded Medicaid benefits.

Among the court’s options: leave the law unchanged; strike it down entirely; and strike down portions of the law, such as the “no pre-existing condition” exclusion requirement, which is a provision linked to the individual coverage mandate, according to a May 2012 SHRM Online article.

Positive Financial Impact Foreseen

When asked which ruling would have the most positive financial impact on their organizations, respondents said:

  • Throwing out the full law: 58 percent.
  • Keeping the full law intact: 27 percent.
  • Striking down the individual mandate but leaving other pieces of reform intact: 14 percent.

However, provisions of the law that many respondents would like for the court to keep intact include:

  • The ability to offer increased wellness incentives: favored by 33 percent.
  • The requirement to eliminate pre-existing condition exclusions: favored by 23 percent.
  • The requirement to cover adult children up to age 26: favored by 22 percent.

IFEBP members are in a “wait and see” mode, according to the survey, with three in five organizations following the case extremely closely or very closely. Fewer than 2 percent are not monitoring the case. Those with fewer than 50 workers and those with more than 10,000 workers are paying the closest attention to the case, according to the IFEBP.

“While the [IFEBP] recognizes that reaching a consensus on the [reform law] among our membership would be difficult,” IFEBP CEO Michael Wilson said in a released statement, “it’s clear that our members agree that steps must be taken to address the access to quality, affordable health care in America.”

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