By now you’ve probably heard: The Supreme Court has ruled for the defendants in the closely-watched King v. Burwell case. However, even with all of the fiery debate around this case, you may not have heard a simple explanation of what this decision actually means for you.
In short, the ruling preserves the insurance subsidies for qualified Americans receiving health insurance through the federal exchange, Healthcare.gov. There are currently 34 states using the federal marketplace, and the 6.4 million people eligible for subsidies will continue to receive tax credits that help make their health insurance affordable.
So what does this mean for enterprise healthcare?
For the moment, nothing has really changed. This decision leaves the employer mandate intact, so most large employers will continue to offer health insurance coverage as a matter of course. As you know, large businesses have long offered health coverage to their employees, and more than 12 times as many people will continue to get insurance through their employers as compared to the ACA exchanges.
And the other parts of the ACA remain fully in force, from minimal essential benefits requirements to the coming excise tax, or “Cadillac tax,” on employers with high-cost health benefits (scheduled for 2018). The Cadillac tax is meant to raise tax revenue while at the same time discourage the health plans that encourage over-utilization of, and thus inflation in healthcare. According to a Towers Watson analysis of their [2014 Healthcare changes ahead] survey of large U.S. employers, 48% of companies with more than 5,000 employees will likely be subject to the tax in 2018 if their current benefits remain unchanged – and that number will likely climb to 82% by 2023.
This is the next major milestone of the ACA, and business leaders are already taking steps to limit exposure to it. Forward-thinking HR and finance leaders are implementing new approaches to enterprise healthcare that provide for the health, wellness, and productivity of their most vital asset—their people—while at the same time lowering overall healthcare costs and avoiding future excise taxes.
At the heart of these new approaches is something the president stated clearly yesterday, “We’ll keep working to provide consumers all the tools you need to make informed choices about your care.” At Castlight Health, that’s our mission, and we believe organizations that adopt a full enterprise healthcare management solution will have a strategic advantage over those who don’t, regardless of what happens in Washington, D.C.
Interested in learning more about what enterprise healthcare management is and what these new solutions can do for you? Check out the American Health Policy Institute’s recent report, “Knowing More, Managing Better: Transparency and the Emergence of Enterprise Healthcare Management.”
And for more info on the upcoming Cadillac tax and what you need to do to prepare for it, listen to our recent webinar with Bob Kocher, former Special Assistant to the President for Healthcare and Economic Policy.