New Healthcare Law Beneficial To Cover Employers

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Stabilization of employer coverage

The number of individuals covered by a health insurance plan offered by their employers has witnessed a decline. However, the new healthcare laws are forecasted to continue providing coverage to employees from their jobs, after the laws are fully implemented.

Reduction in the percentage of individuals covered

In 2000, approximately sixty-nine percent of the adults received health covers through their employers. However, this number has declined to sixty-one percent in 2009, according to a study by the Robert Wood Johnson Foundation. The biggest number of individuals who were affected included individuals belonging to the low and moderate-income households who are employed with small firms. According to Julie Sonier, the new healthcare law was underlined by the need of the decline in the number of employer-sponsored health insurance covers.

Non-coverage costs the system

According to Sonier, the decline in the number of employees covered by their employers has resulted in the costs being incurred by the healthcare system. The costs are incurred through public coverage, no coverage, or higher non-reimbursed expenses at the local medical facilities. The new law will reduce this burden on the healthcare system. A separate study by the centrist Urban Institute concluded that the new healthcare law proposed by President Barrack Obama will enable small employers to provide insurance coverage to their employees. The study shows that the new law is beneficial to save costs for companies that hire less than fifty employees. Furthermore, the law will provide tax benefits to small firms that provide health cover and penalize larger companies that receive subsidized health costs and will be implemented by 2014.

Studies contradict McKinsey report

According to these studies, the Affordable Care Act will stabilize the influence of small employers that offer health coverage to its employees. This is contradictory to an earlier report that was prepared by McKinsey. According to the McKinsey report, almost thirty percent of employers would discontinue covering their employees under health plans after the state insurance exchanges commenced their operations. The report was a fresh round of criticism for the Obama administration and its new healthcare law.

Endnote on the debate

After the McKinsey report was published, the Democratic Party wanted the consulting firm to clarify the methodology adopted because several other reports had concluded small effect on the coverage offered by small employers. The reaction to the proposed changes in the healthcare laws has received a mixed reaction and it is left to be seen what the actual effects of these changes will be after the law in implemented at a future date.