Health Reform: Half of Organizations Are Still Waiting for Guidance

Here’s something that few of you will probably take issue with, and it’s this: the American business community is still pretty confused about what last year’s big health care reform bill will ultimately mean to them.

So given that, the findings from this just released survey shouldn’t come as a big surprise, either: almost half of organizations that responded (48 percent) say they are waiting for regulatory guidance or additional information before making decisions on changes to their company’s health-care plans.

This new survey comes courtesy of SHRM and is titled Health Care Reform — Where are Organizations in the Decision-Making Process?” Conducted in late December, “it shows a growing number of organizations deciding not to drop health-care coverage. Slightly more than one-half of organizations — 51 percent — said they were not dropping coverage for employees as a result of reform — an increase from the 46 percent reported in SHRM’s first health-care reform poll” released back in June.

Organizations “not counting on repeal”

The survey also found that, despite noises coming out of the new Congress about possible changes or wholesale repeal of the health care mandate, about two-thirds of organizations are not waiting to see if specific provisions are repealed, and three-quarters say they are not waiting for a repeal of the entire law before making decisions about their organization’s health care plans.

“A majority of organizations are not counting on repeal. They are seeking guidance and moving forward to make sure they comply with the law,” said Mark Schmit, director of research at the Society for Human Resource Management in a press release accompanying the survey results. “This is the smart approach because a health-care plan design affects the entire organization.”

Here are a few more of the survey highlights:

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  • Almost one-third of organizations — 27 percent — are still conducting or plan to conduct an analysis to determine whether to continue offering health-care coverage, or, to drop coverage and pay the opt-out fees.
  • Organizations with self-insured plans are more likely to already have conducted an analysis of the impact of the legislation and decided not to drop health-care coverage for their employees.
  • When asked about specific provisions of the health care reform law, from 27 to 65 percent of organizations reported no barriers to putting the mandated provisions into place.
  • However, the cost for organizations of adding benefits for adult children up to age 26 was cited as a barrier for 54 percent of respondents, and the employee out-of-pocket cost was cited by 34 percent of organizations as a barrier for excluding over-the-counter medications from flexible spending accounts; and,
  • Some 39 percent of those surveyed cited cost to the organization as a barrier to implementing the tax form 1099 requirement for vendor transactions above $600 — a provision that has been targeted for repeal by Congress and the Obama administration.

Comfort level with legislation rising for HR pros

SHRM surveyed nearly 700 randomly selected HR professionals with the job title of manager and above, as well as HR professionals in the compensation and benefits area. All analyses were based on respondents working at organizations with a staff size of 50 or more employees. The margin of error is plus/minus 4 percent.

The great things about the SHRM survey process on the health care legislation is that they are tracking the results over time and therefore can show the shifting of opinions as HR professionals get more (or maybe in some cases less) comfortable with the slowly emerging details behind health care reform.

In fact, this latest survey shows that more HR pros — 62 percent — report being comfortable with their knowledge of the complex health-care reform law, an increase from the 48 percent who were asked the same question last June.

There’s more details in the survey, of course – and you can find a copy here on the SHRM website. If you wonder how your health care reform-mandated planning stacks up to everyone else, this survey should give you some needed perspective.

John Hollon is Editor-at-Large at ERE Media and was the founding Editor of TLNT.com. A longtime newspaper, magazine, and business journal editor, John has deep roots in the talent management space. He's the former Editor of Workforce Management magazine and workforce.com, served as Editor of RecruitingDaily, and was Vice President for Content at HR technology firm Checkster. An award-winning journalist, John has written extensively about HR, talent management, leadership, and smart business practices, including for the popular Fistful of Talent blog. Contact him at johnhollon@ere.net, connect with him on LinkedIn, or follow him on Twitter @johnhollon.

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