shrm health care reform poll
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June 27, 2010
SHRM Poll: Organizations’ Response to Health
Care Reform
Organizations’ Response to Health Care Reform | ©SHRM 2010
Health Care Reform Series: Poll 1Introduction
Landmark legislation that brought about major reforms in health care coverage in
the United States was enacted in March 2010. The law affects employers and
HR professionals in a variety of ways. SHRM will be conducting a series of polls
on health care reform and the implications for employers and employees. The
findings from the first poll in this series, which was conducted in June 2010, are
included in this presentation.
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Organizations’ Response to Health Care Reform | ©SHRM 2010
Key Findings
• Will Organizations Drop Health Care Coverage? Nearly one-half of organizations (46%) have
decided not to drop health care coverage for employees as a result of the new health care reform
law. Of these organizations, 34% made this decision without conducting an analysis to determine
whether to continue offering health care coverage or to drop coverage and pay opt-out fines. Twelve
percent did conduct such analysis and decided not to drop coverage. More than one-third of
organizations (37%) are still conducting or plan to conduct an analysis on the impact of health care
reform.
• Will Employees Pay More? Forty-one percent of organizations indicated that they are likely to pass
increased health care coverage costs to employees in 2011, regardless of whether these costs are
directly related to the new health care reform law.
• Alternative Health Care Plans on the Rise? Thirty-four percent of organizations are considering
alternative health care plans for employees as a result of the new health care reform law.
• The Impact of Dropping Health Care on Organizations. Regardless of whether it was
economically more sound, the primary reasons behind the organizations’ decisions not to drop
health care coverage were: 1) it would lower employee morale and job satisfaction, 2) it would make
organizations non-competitive in recruiting new employees, and 3) it would send the message that
the organization does not value the health of its employees.
• It Is Too Early to Tell: The primary reason organizations would be likely to drop health care
coverage and pay opt-out fines is if it would result in significant savings for the organization. Yet
50% of organizations indicated that they are unsure whether their organization would be dropping
health care coverage at this time, meaning it is simply too early to tell.
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Organizations’ Response to Health Care Reform | ©SHRM 2010
16%
<1%
<1%
12%
15%
22%
34%
0% 10% 20% 30% 40%
Unsure at this time
Will not conduct an analysis and already decided to drop health care coverage
Already conducted an analysis and decided to drop health care coverage
Already conducted an analysis and decided not to drop health care coverage
Plan to conduct such an analysis
Currently conducting analysis
Will not conduct an analysis and already decided we will not drop health care coverage
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Is your organization engaging in an analysis to determine the impact of the new health care reform law on your health care plan?
Note: n = 813. Percentages do not total 100% due to rounding.
Organizations’ Response to Health Care Reform | ©SHRM 2010
Is your organization engaging in an analysis to determine the impact of the new health care reform law on your health care plan?
• Currently conducting analysis (by staff size): Larger organizations (those with 500 or more employees) were
more likely than organizations with fewer than 500 employees to report that they are currently conducting an analysis
on the impact of the health care reform on their health plans.
• Currently conducting analysis (by sector): Publicly owned for-profits (37%) were more likely than all other sectors
to report that they are currently conducting an analysis on the impact of the health care reform on their health plans.
Smaller percentages of privately owned for-profits (19%), nonprofits (15%) and government entities (14%) reported
conducting such analysis at this time.
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Comparison by Organization’s Staff Size and Sector
Smaller Organizations Larger Organizations Differences Based on
Organization Staff Size
•50 to 99 employees (2%)
•100 to 499 employees
(9%)
•500 to 2,499 employees
(23%)
•2,500 to 24,999
employees (36%)
•25,000 or more
employees (40%)
Larger organizations >
smaller organizations
Organizations’ Response to Health Care Reform | ©SHRM 2010
• Will not conduct an analysis and already decided that organization will not drop health care coverage (by
staff size): Smaller organizations (those with fewer than 2,500 employees) were more likely than organizations with
2,500-24,999 employees to report that they will not conduct an analysis and have already decided that they will not
drop health care coverage.
• Will not conduct an analysis and already decided that organization will not drop health care coverage (by
sector): Privately owned for-profits (35%), nonprofits (38%) and government entities (50%) were more likely than
publicly owned for-profits (24%) to have not conducted an analysis and have already decided not to drop employee
health care coverage.
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Comparison by Organization’s Staff Size and Sector (continued)
Smaller Organizations Larger Organizations Differences Based on
Organization Staff Size
•50 to 99 employees (49%)
•100 to 499 employees
(40%)
•500 to 2,499 employees
(40%)
•2,500 to 24,999
employees (25%)Smaller organizations >
larger organizations
Is your organization engaging in an analysis to determine the impact of the new health care reform law on your health care plan?
Organizations’ Response to Health Care Reform | ©SHRM 2010
Will your organization pass on to employees any increased or decreased health care coverage costs (e.g., premiums, co-pays, etc.) in 2011 that may be directly or indirectly related to the new health care reform law?
2%
10%
41%
23% 23%
15%
25%
30%
10%
20%
0%
10%
20%
30%
40%
50%
Highly unlikely Unlikely Likely Highly likely Unsure at this time
Increased costs (n = 814) Decreased costs (n = 813)
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Note: Percentages may not total 100% due to rounding.
Organizations’ Response to Health Care Reform | ©SHRM 2010
Is your organization considering alternative health care plans (e.g., less expensive coverage plans, health savings accounts, self-funding, etc.) as a result of the new health care reform law?
34%
30%
36%
0%
10%
20%
30%
40%
Yes No Unsure at this time
8
Note: n = 813.
Organizations’ Response to Health Care Reform | ©SHRM 2010
Even though it may be an economically sound decision for your organization to drop health care coverage and pay the opt-out fine, what would be your organization’s primary reason for keeping health care coverage?
5%
7%
11%
26%
26%
28%
33%
41%
0% 10% 20% 30% 40% 50%
Other
Unsure at this time
N/A - Offering/keeping health care coverage is more economically sound for my organization
Dropping health care coverage would make us non-competitive in retaining top employees
Dropping health care coverage would significantly increase employee turnover at all levels of the organization
Dropping health care coverage would show that we do not value the health of our employees
Dropping health care coverage would make us non-competitive in recruiting new employees
Dropping health care coverage would lower employee morale and satisfaction
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Note: n = 819. Respondents were asked to select their two primary reasons.
Organizations’ Response to Health Care Reform | ©SHRM 2010
Even though it may be an economically sound decision for your organization to drop health care coverage and pay the opt-out fine, what would be your organization’s primary reason for keeping health care coverage?
• Dropping health care coverage would lower employee morale and satisfaction (by staff size): Smaller
organizations (those with fewer than 2,500 employees) were more likely than organizations with 2,500 to 24,999
employees to report that dropping health care coverage would lower employee morale and satisfaction.
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Comparison by Organization’s Staff Size
Smaller Organizations Larger Organizations Differences Based on
Organization Staff Size
•50 to 99 employees (54%)
•100 to 499 employees
(43%)
•500 to 2,499 employees
(46%)
•2,500 to 24,999
employees (27%)Smaller organizations >
larger organizations
Organizations’ Response to Health Care Reform | ©SHRM 2010
If it were an economically sound decision and your organization would be likely to drop health care coverage and pay the opt-out fine, what would be your organization’s primary reason for doing so?
5%
50%
10%
9%
9%
14%
32%
0% 10% 20% 30% 40% 50% 60%
Other
Unsure at this time
Not applicable; Would not drop health care coverage
Dropping health care coverage would ultimately lower employees’ total contributions to their health coverage
Dropping health care coverage would encourage employees to take more responsibility for making sound
health care decisions
Dropping health care coverage and providing an equal amount of compensation to employees to replace the loss
would be viewed positively by employees
Dropping health care coverage would save the organization substantial amount of money
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Note: n = 819. Respondents were asked to select their two primary reasons.
Organizations’ Response to Health Care Reform | ©SHRM 2010
Demographics: Organization Industry
IndustryManufacturing—other 14%
Health care, social assistance (e.g., nursing homes, EAP providers) 12%
Financial services (e.g., banking) 7%
Government/public administration—federal, state/local, tribal 7%
Services—professional, scientific, technical, legal, engineering 7%
Retail/wholesale trade 6%
Educational services/education 5%
Insurance 5%
Construction, mining, oil and gas 3%
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Note: n = 796. Percentages do not total 100% due to rounding.
Organizations’ Response to Health Care Reform | ©SHRM 2010
Demographics: Organization Industry (continued)
IndustryHigh-tech 3%
Other services (e.g., nonprofit, church/religious organizations) 3%
Utilities 3%
Consulting 2%
Services—accommodation, food and drinking places 2%
Telecommunications 2%
Transportation, warehousing (e.g., distribution) 2%
Arts, entertainment, recreation 1%
Biotech 1%
Manufacturing—auto/auto-related 1%
Publishing, broadcasting, other media 1%
Real estate, rental, leasing 1%
Association—professional/trade 1%
Pharmaceutical 1%
Other 9%
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Note: n = 796. Percentages do not total 100% due to rounding.
Organizations’ Response to Health Care Reform | ©SHRM 2010
Demographics: Organization Sector
5%
8%
19%
24%
44%
0% 10% 20% 30% 40% 50% 60%
Other
Government sector
Nonprofit organization
Publicly owned for-profit organization
Privately owned for-profit organization
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Note: n = 794
Organizations’ Response to Health Care Reform | ©SHRM 2010
Demographics: Organization Staff Size
9%
28%
32%
25%
6%
0%
10%
20%
30%
40%
50%
50 to 99 employees 100 to 499 employees 500 to 2499 employees
2500 to 24999 employees
25000 or more employees
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Note: n = 688
Organizations’ Response to Health Care Reform | ©SHRM 2010
Demographics: Other
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Note: n = 813
U.S.-based operations 74%
Multinational operations 26%
Single-unit company:
Companies in which the
location and the company
are one and the same.
28%
Multi-unit company:
Companies that have more
than one location.
72%
Multi-unit headquarters determines
HR policies and practices
60%
Each work location determines HR
policies and practices
2%
A combination of both the work
location and the multi-unit
headquarters determine HR
policies and practices
38%
Is organization a single-unit company or a multi-
unit company?
Are HR policies and practices determined by
the multi-unit corporate headquarters, by each
work location or both?
Does organization have U.S.-based
operations (business units) only or
does it operate multinationally?
Note: n = 803
Note: n = 603
• 20% of organizations indicated that
employees at their work location were
unionized.
Note: n = 791
Organizations’ Response to Health Care Reform | ©SHRM 2010
SHRM Poll: Organizations’ Response to Health Care Reform
• Response rate = 15%
• Sample comprised of 819 randomly selected HR professionals with the job title of manager and above, as well as HR professionals in the compensation and benefits functional area. All analyses were based on respondents working at organizations with a staff size of 50 employees or more.
• Margin of error is +/- 3%
• Survey fielded June 16–June 23, 2010
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Methodology
For more poll findings, visit:
www.shrm.org/surveys
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