Many Employers to Offer “Skinny” Insurance Plans in 2015

According to a survey by the National Business Group released earlier this month, as many as 16 percent of large employers will seek to minimize their healthcare costs next year by offering low-benefit, or “skinny”, plans to their employees.

The companies that will offer skinny plans versus fully ACA-compliant plans were not identified by their industries in the survey; however, traditionally companies with a high percentage of low-wage employees have taken the most advantage of those plans. Skinny plans are considered “minimum essential coverage” by ACA standards by virtue of being employer-provided, but are often lacking other key features that roll into that distinction.

Skinny plans allow employers to avoid a penalty by simply offering a plan, and purchasing one allows the employee to avoid individual mandate penalties by enrolling in a healthcare plan with lower premiums. Unfortunately, the benefits to individuals end there. Some plans cover nothing but preventive care, and all plans feature exorbitant deductibles that can make actually seeking care an unaffordable option should the employee ever require it.

Another significant blow to employees at these companies is that they will not qualify for subsidies to purchase better coverage on state or federal exchanges because their employer offers an ACA-compliant plan, regardless of whether they enroll in that plan or not.

The effect of skinny plans on healthcare costs to providers and vendors remains to be seen.

PRN Funding offers a variety of customized healthcare factoring solutions to healthcare vendors in order to cover operating costs – including providing insurance. To learn more about healthcare factoring or medical receivables factoring and apply for service, contact PRN Funding today.

Some Employers Cut Back Health Insurance to Contain Costs

In an effort to offset rising insurance costs, and in part as a response to the Affordable Care Act going into effect, some employers will begin requiring their employees to pay an additional fee for their spouses’ healthcare coverage, or will eliminate that coverage entirely.

Some companies, such as UPS, have decided to exclude spouses from their employer-sponsored health plans beginning in 2014 if those spouses have access to health insurance through their employers. Experts suggest this as a reasonable cost-cutting measure for a couple of reasons: one, covered spouses are more likely to be women, who use the health system more through middle age and therefore cost more; and two, the employer mandate will shift those costs by requiring the spouses’ employers to offer affordable coverage.

Another factor for companies’ consideration is the pending “Cadillac tax”, which will add a further 40 percent tax to premiums above established ceilings for individual and family coverage. While the tax does not take effect until 2018, large companies are working to lower their spending now in preparation. Important to note is that restricted coverage will not affect spouses who do not have coverage through an employer, nor will it impact minor dependents on employees’ plans.

The percentage of companies who plan to eliminate or charge for spousal support is in the single digits, and several studies cited by the Department of Health and Human Services suggest that it will remain a minority plan of action. In addition, the NY Times cites Mercer senior health consultant Barry Schilmeister as claiming this type of action would “not…be a popular move among employees.”

PRN Funding can help healthcare companies seeking a cash flow alternative to scaling back their health coverage. Healthcare factoring is available for vendors filling a variety of healthcare roles, including temporary nurse staffing, medical billing, and home health care. By purchasing invoices for service and advancing immediate cash, PRN’s factoring program provides the flexibility your company needs to provide the right kind of health coverage for your employees.

Contact us to learn more about healthcare factoring and to get started today.