CFOs see an opportunity, the end of employer based health benefits

“Ezekiel Emanuel, the White House health care advisor, said that health systems are already preparing for it (implementation of PPACA) and changing their practices. He said he expects the Cadillac tax to have an effect well before it comes into play in 2018.

 ‘I think CFOs at companies will go to their insurance brokers and say you have to refashion our plan so we’re under the cap,’ said Emanuel, 52. ‘That is going to be very anti- inflationary.'”

Well, he is right about that. Many CFOs welcome an opportunity to cut benefits, but they don’t have to go to a broker, they just tell their benefits department to cut and call it in the best interest of the company. Not only will deductibles and co-payments be raised, but some coverage will be eliminated such as retiree prescription coverage.

Very anti-inflationary? We will see, cutting costs once by cutting benefits does not change health care trends unless you believe that raising a deductible lowers the demand for health care.

If the objective of reform is to raise individual out of pocket costs and make more people dependent on government programs—mission accomplished!

Make no mistake about it, the PPACA is the beginning of the end of employer based health coverage and on the way down that road, workers are going to lose benefits and see their costs rise.