Advocates of consumer-directed health plans (CDHPs) claimed that these plans would be an affordable option for small employer health plan sponsors who were contemplating terminating their plans because of rising costs. However, health plan offerings by small employers continued to erode despite the widespread availability of CDHPs in 2007.
According to a recent Mercer survey, more than a fifth (22 percent) of small employers that provide coverage do not subsidize family coverage at all; employees themselves are responsible for covering the health cost incurred by their family members.
While a significant majority of large employers remain committed to offering employee coverage to their full-time employees and their families, providing health care for part-time employees has proven to be a greater challenge. The study found that in wholesale and retail industries more than a third of the workforce is made up of part-timers (42 percent and 34 percent, respectively), yet only 62 percent of large employers with part-time employees extend health coverage to part-timers.
"While the average cost of an HSA-based CDHP is about 20 percent lower than the average medical plan, that doesn't make it affordable to all employers. Solving the problem of the uninsured will mean addressing the question of affordability," said Blaine Bos, Mercer worldwide partner and spokesperson for the survey.
One proposed solution is so-called "mini-med" plans which limit the total amount of benefits payable in a given year. These are now offered by 7 percent of all large employers and 19 percent of large wholesale/retail employers according to the survey.
"The arguments for and against mini-med plans tend to fall into the 'is the glass half-empty or half-full?' variety," said Bos. "Some employers think they're better than nothing. Others think they're dangerously inadequate because they don't cover catastrophic expenses."