By Kerry Young, CQ HealthBeat Associate Editor
August 13, 2014 -- Many companies are changing their health benefits to try to avoid a tax slated to hit in 2018 on more generous insurance coverage, a survey found.
Last week The National Business Group on Health released results from a survey of 136 companies, most of which have more than 10,000 employees.
The survey found that almost a third, 32 percent of those surveyed, plan to offer high-deductible, or consumer driven, health plans. Only 22 percent have done so this year.
The companies polled expected to keep their cost increases to about 5 percent for 2015 by increasing the portion of costs paid directly by consumers, such as using high-deductible plans. That's less than the 6.5 percent expected increase that the companies would expect if they made no such changes.
Companies are already looking at steps to avoid a 40 percent excise tax that starts in 2018. The so-called "Cadillac tax" was included in the health law (PL 111-148, PL 111-152) to raise revenue for its coverage expansion and is to be imposed in cases where the value of medical benefits crosses certain limits, in most cases $10,200 for individual coverage and $27,500 for family coverage.
The limits are indexed to inflation as measured by a form of the Consumer Price Index. Medical costs tend to rise much faster, which make it a challenge for many companies to avoid the tax, said Brian J. Marcotte, president and chief executive of the National Business Group on Health. In time, many large companies will reach the limits.
"There are companies that are worried about hitting it immediately in 2018 and they are aggressively trying to work with their benefits," he said.