Majority of Employers Committed to Offering Healthcare Coverage

December 12, 2011 ( – The majority of employers are committed to continuing to offer healthcare coverage to their employees, according to a survey from Towers Watson.

More than two-thirds (71%) of the 368 mid-size to large U.S. companies surveyed by Towers Watson in July expect to continue offering health coverage to their active employees through 2014. An even higher percentage (84%) say healthcare benefits will continue to be a key component of their overall employee value proposition beyond 2014.  

Most employers (88%) are planning small or moderate changes to their healthcare plans for 2012, and roughly half (45%) will rethink their long-term healthcare strategy during the year.  

Nearly four in five employers (78%) plan to monitor other companies’ responses to healthcare reform and will be influenced by the actions other large employers take regarding ongoing plan sponsorship.  

Towers Watson said healthcare costs are expected to rise at a noticeably slower rate in 2012 compared to 2011 (5.9% versus 7.6%). Roughly two-thirds of respondents indicated they will increase employees’ share of premium contributions, 8% will significantly reduce their subsidization of coverage for spouses and dependents in 2012, and a further 23% are considering reductions in 2013 and 2014.  

A majority (54%) of employers are confident that healthcare reform will be implemented within the anticipated timeline. However, 70% are skeptical that health insurance Exchanges will provide a viable alternative to employer-sponsored coverage for active employees in 2014 or 2015.  

More than half of employers (54%) that offer retiree healthcare benefits plan to discontinue them for both pre-65 and post-65 retirees. Many will implement strategies to transition retirees to alternate forms of coverage.  

The vast majority of respondents (88%) plan to take steps to control their costs and avoid the impact of healthcare reform’s excise tax, due to take effect in 2018. More than half (56%) believe their current plans will trigger the excise tax.  

The complete survey report is available at