Ahead of President Biden’s State of the Union address this year, the White House announced the creation of a federal task force to tackle high health care costs.
It’s not just the costs of groceries and gasoline that are impacting American families – the costs of health care services have continued to rise as well. In the face of this medical inflation, it’s more important than ever that workers have robust and affordable employer-provided coverage.
Over 160 million Americans are covered through work, the single largest source of health care coverage in the United States. As the White House examines policy solutions to address high health care costs, it should look to the actions of U.S. employers and embrace the successful principles of employer-provided coverage.
U.S. employers know that Americans expect and rely on high-quality health care coverage to provide peace of mind. This coverage does just that by evolving to meet the health care needs of the workforce through plan innovation. American businesses also continue to absorb health costs to secure reasonable premiums and costs for their workforce.
Health coverage provided through work undoubtedly remains the best system to adapt to and address the needs of workers and their families. This system gives employers the ability to develop and deploy programs that keep their workforce healthy which helps to hold down costs. This includes expanding options for mental health services, telehealth, and other wellness programs.
A recent study from Mercer shows that employers are using their tools to keep costs lower than they would otherwise be. Mercer notes, “Many factors could be helping to temper cost growth — including strategies focused on improving patient outcomes. As employers have moved away from cost-shifting to employees, they have increasingly implemented longer-term cost-management strategies directed at the biggest drivers of cost — complex care and chronic medical conditions. Many larger employers have strategies in place that steer members to higher-quality care.”
Central to the affordability and accessibility of employer-provided coverage is also a stable and uniform regulatory environment. That’s why employers are dedicated to the continued protection of the Employee Retirement Income Security Act (ERISA).
Policymakers must appreciate that ERISA preemption protects self-insured employers — and the employees and their families these plans cover — from a patchwork of 50 state laws that would complicate plan design, increase the administrative burdens, and interfere with the ability to offer uniform benefits to employees. As we recognize the 50th anniversary of ERISA this year, it’s critical we protect ERISA preemption to avoid uncertainty in plan designs and to keep costs low for employers and employees alike.
For decades, employers of all sizes have recognized the value of offering health care coverage, reporting a high return on investment. American workers are also highly satisfied with the health care coverage they receive through work, noting it’s “comprehensive,” “affordable,” and “high-quality.”
As the newly created task force reviews solutions to level health care costs, employer-provided coverage should serve as a playbook. It’s a win-win for employers and employees. It continues to provide affordable, high-quality care for employees and their families, and it’s a foundational recruitment and retention tool for businesses across the nation. U.S. employers remain committed to this model because it’s the most innovative, responsive way to meet the needs of Americans today and tomorrow.
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About the authors
Protecting Americans’ Coverage Together (PACT)
The Protecting Americans’ Coverage Together (PACT) is a coalition of leading business voices that are dedicated to strengthening the support of ESI for families that depend on this system for the physical and mental well-being. Its members include the U.S. Chamber of Commerce, Business Roundtable, the National Association of Manufacturers, Council for Affordable Health Coverage, and Vermeer Corporation.
