Employment Law Blog

News, trends and analysis in employment law and HR

Jun 17, 2011

Study shows significant number of employers likely to drop health coverage

Health Care Reform 

A recent survey by an online business journal, McKinsey Quarterly, indicates that as many as 30 percent of employers will “definitely” or “probably” stop offering employer-sponsored health insurance after 2014. Among the other surprising findings, the survey results indicate that this figure rockets up to nearly 60 percent among employers who have a higher awareness of health care reform, including the burdens it will place on employers and the availability of health coverage alternatives to lower-income employees.  The survey concludes that around 30 percent of businesses would actually gain economically from discontinuing health coverage, even if they increase employees’ compensation to make up the difference, and somewhat surprisingly, the survey finds that the vast majority—more than 85 percent—of employees would remain at their jobs even if their employer stopped offering health coverage.


Tips: Like it or not, health care reform is here to stay, whether on the state or the federal level, and it will impact the way you do business. While there remain many unknowns, now is the time to start evaluating what steps your company may take to respond to future changes. Vigilant will keep its members informed of new developments and trends.