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Survey shows group health plans aren't going anywhere

Posted On Wed, November 10, 2010

Health insurance is considered a valuable benefit to many employees. It's likely that businesses of all sizes will maintain plans even after insurance exchanges are implemented in 2014, according to a survey by consulting firm Mercer.

The company's survey revealed that 20 percent of firms with less than 500 employees and 6 percent of those with more than 500 staff members were likely to drop health insurance benefits in 2014.

Study director Beth Umland says while the number of companies reporting they are likely to drop coverage may seem high, there is a chance many won't do so.

"You can see why the idea of dropping employee health plans would be attractive to small employers," says Umland. "On the other hand, when you look at the experience in Massachusetts, where insurance exchanges have been operating under state-based health reform for over three years, it hasn't happened."

In 2006, Massachusetts made it a law that adults who could afford health insurance had to purchase it. Those who fail to comply are hit with a tax penalty. Many look towards the state as a harbinger of what will happen nationwide in terms coverage.

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