How the ACA Helped Create the Current Benefits Climate

Though the proponents and opponents of the Affordable Care Act (ACA) disagreed on nearly every point in the months leading up to the bill’s passage, they did agree on one thing: the ACA becoming federal law would fundamentally alter how health insurance is obtained in this country. They were right. But could any of them have predicted how the ACA would eventually help create the current benefits climate?

ACA mandates have significantly influenced everything from private health insurance to how healthcare providers deliver services. Its impact on our healthcare system has been more profound than most people know. As for its contribution to the current benefits climate, it boils down to the fact that health insurance is now expected.

• A Genuine Perk

Prior to the ACA’s passage, there was no such thing as mandatory health insurance in the U.S. Companies were free to voluntarily offer group plans if they wanted, but they were not forced to. Likewise, employees weren’t required to participate in group plans.

Back then, health insurance was a genuine perk. It was harder to come by among employees working for smaller companies with limited benefits budgets. In some industries, only the best of the best were offered health insurance. Workers with health plans were considered part of a privileged class.

The practical effect of that old model, in terms of hiring and retention, was that it made health insurance so much more valuable. Employers could use their group health plans as leverage in the competition for talent. All of that went away with implementation of the ACA.

• Health Insurance Is Standard

The ACA’s biggest impact on health insurance, as a benefit, is found in the employer mandate. Though there are exceptions to the rule, most employers now have no other choice but to offer group health insurance to employees who want it. As such, health insurance is a standard expectation.

Job seekers expect health insurance to be on the table when they apply for jobs. It no longer stands out to them. In fact, you could make the case that job seekers and employees alike now take health insurance for granted.

• We Need More

Employers who were once as impressed with their health insurance plans as their employees, are now discovering that they need more to impress. Standard health insurance and retirement plans are not enough. So what are they doing?

The experts at general agency brokerage BenefitMall say more and more employers are turning to ancillary benefits. As a general agency representing more than a hundred carriers, BenefitMall has seen a gradual increase in the demand for ancillary benefits to supplement standard health insurance. These are benefits like:

• dental and vision plans
• critical illness and disability coverage
• commuter and child care benefits
• student loan repayment programs.

Even benefits like pet insurance and remote work expense accounts are on the table. Employers are pulling out all the stops in an attempt to find a benefits package that resonates with most of their employees.

• Not What It Used to Be

Regardless of your personal opinions about the ACA, it’s hard to argue that health insurance isn’t what it used to be. Implementation of the ACA made health insurance standard fare. Even a good plan isn’t enough to raise eyebrows anymore.

Will that still be the case 20 years from now? Who knows. It is quite possible that a single-payer system will replace private health insurance altogether. Then employers will have to dig even deeper to come up with the benefits they need to attract and retain top talent. If nothing else, it sure will be interesting to watch.