Will Affordable Care Act Lead To More Or Less People With Employer-Sponsored Insurance? (Hint: No One Knows)

With the clock ticking down to 2014, when many of the controversial portions of the Affordable Care Act start kicking in, the folks at the Government Accountability Office thought they would look into whether or not certain provisions in the law would cause some employers to stop offering health insurance to employees, or cause them to add benefits, or lead consumers to look for cheaper options elsewhere. After sifting through available studies, the GAO came to a conclusion that we’ll probably just have to wait and see.

Starting in 2014, most businesses with at least 50 full-time equivalent employees must offer health insurance that meets a minimum standard or face financial penalties. Some believe this will increase the number of employers who offer coverage to employees and increase the overall number of people with employee-sponsored insurance. Meanwhile, others believe that the availability of more affordable insurance through new “exchange” marketplaces will lead to a drop in the number of people with employer-sponsored coverage, and that some smaller businesses will drop coverage altogether.

In an attempt to sort through the available data, the GAO looked at more than two dozen different studies and surveys on the topic — and found virtually no consistency in the results.

The most consistent results came from the five studies that used statistics-based microsimulations to predict changes within the first two years of the ACA kicking in.

Two of the studies predicted modest increases (2.7%, or approx. 4 million people) in the number of Americans being covered by their employers, while two others showed modest decreases (-2.5% and -1.6% — 4 million and 2.4 million people, respectively), with the fifth study predicting almost no change (.1%, or 200,000 people).

The GAO also looked at 19 surveys of employers regarding the ACA and found, well… that surveys may not be a reliable prediction tool.

While 16 of the 19 surveys concluded that employers would drop coverage, the estimates on just how many would drop coverage in the near term varied wildly, from 2-20%.

Part of the issue with these surveys is that most of them only talked to businesses that currently offer employer-sponsored coverage and asked if the companies plan to drop it. Very few surveys asked businesses if they planned to add coverage because of the ACA.

Of the three surveys that that did ask that question… well, once again the numbers are inconclusive, with anywhere from 1-28% saying they would begin offering coverage because of the new laws.

Another topic on which the surveys sort of agreed is that employees who take employer-sponsored insurance will likely be paying a larger portion of their premium than they already do. But again, it’s impossible to predict just how widespread this will be with surveys predicting anywhere from 16% to 73% of employers will begin requiring higher employee contributions for health care plans.

“[T]he validity of [the survey] results may be limited by the knowledge of survey respondents,” writes the GAO. “Experts have noted that employer surveys tend to be answered by human resource officials with varying levels of knowledge about PPACA. In addition, researchers note that survey responses do not require careful analysis or extensive deliberation and have no consequences for the responders.”