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LSJ: Michigan Businesses Brace For Cost Increases Stemming From ObamaCare

Washington, October 21, 2013
  • Even though the Obama administration delayed until 2015 the financial penalties on businesses with 50 or more full-time equivalent employees that don’t offer adequate health insurance benefits, several taxes and fees will kick in by Jan. 1 — along with a major change in how insurance premiums are calculated. Those taxes and fees amount to a 4 percent to 6 percent health care cost increase for many small and midsize businesses in Michigan that already offer health benefits, according to interviews with insurance brokers and benefits lawyers. 
  • The new premium calculus has resulted in some businesses getting hit with renewal prices for benefit plans that jump 20 percent or more.
  • … Still, rising costs for employers can mean stagnating paychecks for employees. “Even without the health care reform law, every year we’ve seen the trend of our deductibles and co-pays getting a little bit higher,” said David Lindgren, corporate compliance officer at Rosemont, Ill.-based Flexible Benefit Service Corp., which serves health insurance brokers. “This kind of escalates that.”
Businesses brace for Obamacare
The Lansing State Journal
October 19, 2013

Management at one 40-employee Michigan car dealership has been bracing for higher health insurance costs in 2014, when the Affordable Care Act goes into full effect.

But they were shocked to hear this month just how high their renewal rate with Blue Cross Blue Shield of Michigan would jump — 65 percent. Add in the new taxes and fees in the health care law that affect businesses, and the total cost for the dealership of providing medical benefits would rise another 5 percent.

Since learning of these increases, Extreme Dodge Chrysler Jeep of Jackson has debated whether it can afford to continue offering health care to employees, said Mark Trudell, the dealership’s general manager.

If it drops coverage, workers would have to get coverage through a spouse or buy insurance on their own, either directly through an insurer or through the new Michigan Health Insurance Marketplace, also known as a state exchange.

Read the rest of the story at the Lansing State Journal's website HERE
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