Defined Contribution Healthcare Picking Up Steam - News Roundup

Written by: Christina Merhar
Originally published on May 30, 2014. Last updated January 18, 2017.

Defined contribution healthcare - the concept that employers define a contribution rather than a specific benefit plan - is picking up steam. Defined Contribution Healthcare - Picking Up Steam?

Many industry experts relate this shift in healthcare to the shift that happened with retirement benefits -- from “defined benefit” pension plans to “defined contribution” 401(k) plans. And, the idea that employers will cancel group health insurance coverage in favor of individual coverage has been a hot topic in the media.

Here's a roundup of five recent articles on defined contribution and health insurance trends.

Employers May Start Paying You To Buy Health Insurance (NPR/KHN)

In this article, NPR and KHN explore the trend toward defined contribution. What if employers started giving workers a chunk of cash to buy health insurance on their own instead of offering them a chance to buy into the company plan? Are workers ready to manage their own health insurance like they do a 401(k)? Read the story here.

90% of Companies to Abandon Employer-Sponsored Health Insurance by 2020 (Study)

By 2020, 90% of American employees who currently receive health insurance through their employers could be shifted to individual health insurance and government Exchanges, according to a projection by S&P Capital IQ, a division of McGraw Hill Financial. Read a review of the study here.

Why Employers Will Stop Offering Health Insurance (NY Times Blog)

By 2025, “fewer than 20 percent of workers in the private sector will receive traditional employer-sponsored health insurance.” The source of this claim? Dr. Ezekiel J. Emanuel, in his just-published book, “Reinventing American Health Care.” Read the story here.

Cost Increase Prompts Small-Business Owner to Drop Group Insurance (The Inquirer)

This article by Robert Calandra tells a story of so many small businesses in America who are canceling group health insurance due to cost, and looking for alternatives. Read the story here.

Can Advisers Survive a Demise of Small Group Health Insurance Plans (Employee Benefit Advisor)?

With new requirements for employer-sponsored health coverage under the Affordable Care Act about to kick in, some benefit industry insiders predict small business group health insurance will soon be a thing of the past and benefit advisers who want to thrive will need to adapt. Read the story here.

What articles on defined contribution or health insurance trends have caught your eye? Leave a comment below.

The Comprehensive Guide to the Small Business HRA

Originally published on May 30, 2014. Last updated January 18, 2017.


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