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How Health Care Reform May Drive Massive Change in the Voluntary Employee Benefits Market
When President Barack Obama signed into law the Patient Protection and Affordable Care Act on March 23, 2010, comprehensive health care reform became one of the most talked about topics among the public and private sector institutions.
This bill - highly controversial and passed into legislation by the slimmest ol margins - was fiercely debated and evoked huge demonstrations and marches in protest. With an overall intent of expanding· access to health care coverage to all U.S. citizens, the bill requires most U.S. citizens and legal residents to have health insurance by the start of 2018.
Much has already been written about the U.S. health care reform bill (see sidebar for its key highlights) and its impending impact on the U.S. population in the years ahead - with several of its components directly impacting the health care industry.
What can the industry expect?
Controversy, Long Phase-In Add to Confusion
By the time the bill is fully enacted (January 2018), the United States will have held two presidential elections and three midterm election cycles. Given the initial and ongoing opposition to this bill - in addition to the increasing demand and need to reduce government spending - it is not likely that the bill signed into law this past March will remain intact until 2018. Many provisions of the original bill are likely to be modified and possibly repealed entirely.
Beyond the political pressures faced by the current health care legislation, our experience in other countries with national health care platforms has indicated that, over time, individuals may see a reduction of plan services and coverage as the government recognizes that it is economically unfeasible to maintain the original level of services.
In lhe international arena, we (at PVG) have seen the level of government-provided benefits gradually dimmish and - as a result - the increasing amount of health care costs are transferred to individuals. As this scenario develops, insurance carriers and their distributors need to be prepared with alternative and supplemental products that will close the gaps in the national health care system. These changes will mean more updates to employee benefits, as well as the need for continued...