Wednesday, September 24, 2008

Benefits Executives Chime in on Presidential Health Care Plans

One group of Americans that has been following the health care propositions of our presidential candidates very closely is the one made up of benefits executives across the nation. No matter which way things fall, they will find their jobs and approach seriously impacted.

Sen. McCain's approach wold remove the tax exclusion for workplace-supplied benefits. Sen. Obama's would force all employers to offer health benefits. Neither option thrills those whose job it is to administer said benefits. American employers provide the majority of non-governmental health care benefits and either stance stands to cause major changes and complications in the way they do business, a particularly stressful thing to contemplate during the times of economic uncertainty. Still, of the two unpopular plans, Sen. Obama's is seen as the lesser of two evils.

Catherine Arnst of BusinessWeek reports:

The Washington law firm Miller & Chevalier Chartered, together with the American Benefits Council, a trade association, surveyed 187 benefits officers this summer at large U.S. companies to determine their views on the direction of health-care policy in 2009. The respondents were asked their opinion of several health-care reform proposals, without identifying the reforms with any candidate or political party. When asked about "pay or play," the position favored by Obama that would require employers to either provide health care for employees (play) or pay a tax to the government, 46% of respondents said it would have a strong negative effect on their workforce. But 74% said a repeal of the employee tax exemption for employer-based health coverage—McCain's proposal—would have a strong negative effect.
So while both plans are greeted with a less than enthusiastic reception, almost exactly three quarters of benefits execs find the McCain plan to be far more damaging to them. James Klein, president of the Americans Benefits Council, has an explanation of why:

[...] "Companies know they are going to end up paying the bill anyway so they want to continue to have an influence on how those benefits are designed and who is held accountable," he says.

What they don't want, however, is a patchwork system of state reforms. Several states, led by Massachusetts and Maine, have enacted or are considering some form of universal coverage involving employers. But 81% of the respondents support maintaining federal standards, and 84% oppose regulation of employer-sponsored health plans at the state level.

The logic is pretty obvious, especially when you consider the way large companies generally have assets and holdings in multiple states. Federal standards can keep things consistent across the playing field whereas if the individual states regulate the industry, companies could be facing as many different sets of divergent regulations as there are states that they operate in.

The administrative costs alone would probably skyrocket considerably.

SOURCE: "Benefits Execs Prefer Obama's Health-Care Plan" 09/18/08
photo courtesy of I am K.E.B., used under its Creative Commons license

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