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OPINION: Health care coverage works at work


A FINDING THAT STANDS OUT in a new Midwest Business Group on Health survey is the continuing strong commitment of employers to offer health care plans to their employees.

Plenty of pundits said the health care reform law—with provisions that set up state health insurance exchanges and federal premium subsidies for the low-income uninsured—would erode or kill employer-based plans. But, as we report on page 1, the MBGH survey shows no evidence of that.

In fact, only 6% of the survey's respondents say they are very likely or likely to terminate coverage in 2014 when the exchanges are supposed to be up and running and the premium subsidies are to be available.

That doesn't sound like the end of employer-based plans to us.

How does one explain the continuing commitment of employers to provide coverage? One reason is that, contrary to the pundits' assertions, the health care reform law generally doesn't make it financially attractive for employers to terminate their plans.

When adding everything up—paying a $2,000 nontax-deductible penalty for each full-time employee plus adding taxable cash to partially offset the premiums employees would pay for buying coverage in the exchanges—the cost to employers of dropping coverage in many cases will exceed the cost of maintaining their plans, many benefit consultants say.

Perhaps just as important is that employers can greatly influence and improve employees' health through plan design, such as wellness incentives. That, in turn, can lead to greater employee productivity.

We are dubious whether exchanges will have the resources and the desire to offer and successfully administer programs to improve enrollees' health.

But there are limits to employers' willingness to offer health care plans. Given that, the government should do everything in its power to encourage employers to continue to provide coverage to their employees and their dependents.