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Fri Feb 22, 2013, 04:31 PM

 

Companies are dropping health coverage for spouses to cut costs

By denying coverage to spouses, employers not only save the annual premiums, but also the new fees that went into effect as part of the Affordable Care Act. This year, companies have to pay $1 or $2 “per life” covered on their plans, a sum that jumps to $65 in 2014. And health law guidelines proposed recently mandate coverage of employees’ dependent children (up to age 26), but husbands and wives are optional. “The question about whether it’s obligatory to cover the family of the employee is being thought through more than ever before,” says Helen Darling, president of the National Business Group on Health. See: When your boss doesn’t trust your doctor.

While surcharges for spousal coverage are more common, last year, 6% of large employers excluded spouses, up from 5% in 2010, as did 4% of huge companies with at least 20,000 employees, twice as many as in 2010, according to human resources firm Mercer. These “spousal carve-outs,” or “working spouse provisions,” generally prohibit only people who could get coverage through their own job from enrolling in their spouse’s plan.

Such exclusions barely existed three years ago, but experts expect an increasing number of employers to adopt them: “That’s the next step,” Darling says. HMS, a company that audits plans for employers, estimates that nearly a third of companies might have such policies now. Holdouts say they feel under pressure to follow suit. “We’re the last domino,” says Duke Bennett, mayor of Terre Haute, Ind., which is instituting a spousal carve-out for the city’s health plan, effective July 2013, after nearly all major employers in the area dropped spouses.

But when employers drop spouses, they often lose more than just the one individual, when couples choose instead to seek coverage together under the other partner’s employer. Terre Haute, which pays $6 million annually to insure nearly 1,200 people including employees and their family members, received more than 20 new plan members when a local university, bank and county government stopped insuring spouses, according to Bennett. “We have a great plan, so they want to be on ours. All we’re trying to do is level the playing field here,” he says.

http://www.marketwatch.com/story/why-your-boss-is-dumping-your-wife-2013-02-22

22 replies, 2090 views

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Arrow 22 replies Author Time Post
Reply Companies are dropping health coverage for spouses to cut costs (Original post)
dkf Feb 2013 OP
NCTraveler Feb 2013 #1
kenny blankenship Feb 2013 #2
Laelth Feb 2013 #9
liberal_at_heart Feb 2013 #10
RockaFowler Feb 2013 #3
dkf Feb 2013 #5
liberal_at_heart Feb 2013 #11
Warpy Feb 2013 #4
dkf Feb 2013 #6
msongs Feb 2013 #7
blm Feb 2013 #8
dkf Feb 2013 #12
antigop Feb 2013 #13
dkf Feb 2013 #14
antigop Feb 2013 #15
antigop Feb 2013 #16
dkf Feb 2013 #19
antigop Feb 2013 #20
antigop Feb 2013 #17
dkf Feb 2013 #21
antigop Feb 2013 #22
bigapple1963 Feb 2013 #18

Response to dkf (Original post)

Fri Feb 22, 2013, 04:37 PM

1. In the past Helen Darling has advised Republican Senators...

with respect to health care. She is a reason for the problem. Not a solution.

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Response to dkf (Original post)

Fri Feb 22, 2013, 04:41 PM

2. Drop employer based health insurance

Health insurance is what's killing you, America. You need health care instead.

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Response to kenny blankenship (Reply #2)

Fri Feb 22, 2013, 05:16 PM

9. +1. n/t

-Laelth

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Response to kenny blankenship (Reply #2)

Fri Feb 22, 2013, 05:41 PM

10. single payer is the only way

I don't know when the voters will figure it out. They seem to think this affordable insurance act will work but the only thing that will work is single payer.

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Response to dkf (Original post)

Fri Feb 22, 2013, 04:41 PM

3. Can I call BS on this??

I pay for coverage for my husband through my work, but I don't get a discount for it. My company only takes care of my part of the insurance. I have to pay full price for his

It's just that I'm able to get the discounted "group" rate that the company gets for the insurance.

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Response to RockaFowler (Reply #3)

Fri Feb 22, 2013, 04:45 PM

5. The ACA adds an extra fee per person covered.

 

This year it is $1 or $2 for each life covered. In 2014 it is $65 so the bulk of the extra cost hasn't hit yet.

But what they are saying is that by dropping a spouse, they may find both husband and wife move to another plan. Then they get rid of their healthcare costs for that employee. It's pretty devious.

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Response to RockaFowler (Reply #3)

Fri Feb 22, 2013, 05:43 PM

11. I am a stay at home mom and use to be on my husband's insurance.

We paid maybe $100/month for the whole family to have insurance. Now that we have to go to the private market we pay $925/month for the whole family to have insurance. Yeah, I'd say there's a difference between employer based insurance for spouses and private market insurance for spouses.

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Response to dkf (Original post)

Fri Feb 22, 2013, 04:43 PM

4. Keep the worker alive, the spouse and kiddies are expendable

Lovely, just lovely.

When, oh when will this country smarten up and provide Medicare for all?

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Response to Warpy (Reply #4)

Fri Feb 22, 2013, 04:48 PM

6. Now stay at home moms will have to work to get health care

 

Just like potential retirees have to keep working to get health care.

This system is such a mess.

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Response to dkf (Original post)

Fri Feb 22, 2013, 04:58 PM

7. Terre Haute is paying $5000/year for each person covered. sounds kind of overpriced

$6million divided by 1200 people

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Response to dkf (Original post)

Fri Feb 22, 2013, 05:00 PM

8. Time for Universal Healthcare.

.

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Response to blm (Reply #8)

Fri Feb 22, 2013, 06:09 PM

12. This may prove how inefficient the "private" market is.

 

Maybe this is one of Obama's chess moves?

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Response to dkf (Original post)

Sat Feb 23, 2013, 11:56 PM

13. EVERYONE PLEASE READ THIS PREVIOUS POST I MADE! IMPORTANT!

Yes, I'm shouting....

http://www.democraticunderground.com/101653603

Companies have to cover dependents (but not spouses) but dependent coverage probably won't be "affordable".
PLEASE READ THE ARTICLE!

The ACA generally defines “affordable” insurance as coverage that costs no more than 9.5 percent of an employee’s household income in employee-paid premiums. The proposed rule does require that employers must offer coverage to the dependent children (up to the age of 26) of their employees or pay a penalty, but does not require that coverage to meet any threshold of affordability.

“Coverage for an employee under an employer-sponsored plan is affordable if the employee’s required contribution for self-only coverage does not exceed 9.5 percent of the employee’s household income,” the proposal says. Since “self-only” coverage — which, as its name implies, does not include coverage for any family members — is all that needs to be affordable, that means that dependent coverage need not be affordable.

The result is that “an employer could offer insurance to its employees that would cover their kids, but not contribute to the cost of the kids’ coverage at all,” said Robert Hall, the associate director of the Federal Affairs Department at the American Academy of Pediatrics. “No matter what that coverage is going to cost the employee, the employer is off the hook as long as they offer it.”
....
The Administration has yet to announce whether an employer’s failure to offer workers the opportunity to get affordable insurance for their family members means that those family members will be eligible for subsidies to buy individual insurance through an insurance exchange (see box below). Even if they will be deemed eligible, those subsidies would likely not cover the entire cost of purchasing insurance, so families could still end up paying far more than 9.5 percent of their income on insurance premiums.

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Response to antigop (Reply #13)

Sun Feb 24, 2013, 12:01 AM

14. Wow that article called it...

 

They must have known this would happen when they wrote it like that. I wonder what was the thinking behind it.

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Response to dkf (Reply #14)

Sun Feb 24, 2013, 12:05 AM

15. If the spouse has to go to the exchange, they *may not* be eligible for subsidies. nt

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Response to dkf (Reply #14)

Sun Feb 24, 2013, 12:05 AM

16. I tried to get everyone's attention on this when I posted it, but the thread sank. nt

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Response to antigop (Reply #16)

Sun Feb 24, 2013, 12:14 AM

19. I'm re-reading your post and I didn't fully understand how bad this is the first time around.

 

You need to read it a few times to get the impact.

The more I think about it, the more I think this is possibly going to make things worse for those who used to be happy with their coverage.

I really wonder if things are going to fall as planned or if we have created a Frankenstein, and an expensive Frankenstein at that.

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Response to dkf (Reply #19)

Sun Feb 24, 2013, 12:17 AM

20. yes, it's BAD for families..especially if spouse/dependents get insurance through spouse's employer.

nt

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Response to dkf (Original post)

Sun Feb 24, 2013, 12:08 AM

17. Husband, wife, and kid may end up on THREE DIFFERENT FRIKKIN' PLANS! nt

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Response to antigop (Reply #17)

Sun Feb 24, 2013, 12:23 AM

21. But did you also see how plans that have good coverage are going to be deluged

 

As other employers drop spousal coverage so both spouses flock to them?

Just think of unions who have negotiated great health benefits, including government unions, and also self insured plans! Wow.

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Response to dkf (Reply #21)

Sun Feb 24, 2013, 12:28 AM

22. It's going to be one big cluster---- and may make us lose the 2014/2016 elections

I think you are correct...this could very well make things worse for those who were happy with their coverage.

People are going to be outraged when they find out.

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Response to dkf (Original post)

Sun Feb 24, 2013, 12:10 AM

18. move to universal health care

 

already.

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