The Affordable Care Act vs. Employer Coverage: Which is More Popular?


When the Affordable Care Act (ACA) first debuted back in 2010, it had a simple goal: offer better health insurance options to those who were forced to do so on their own. After all, until that point, securing an adequate health insurance policy without an employer was a costly endeavor, forcing many to settle for insufficient coverage—or even no coverage at all.

But this brought up another significant problem: would employers view the Affordable Care Act as an opportunity to eliminate health coverage and send employees out to find their own solution?

The past six years have shown that no, this isn’t the case.

Employees Look for Benefits, So Companies Continue to Provide Them

Even the most informed predictions as to why companies would stop offering benefits were incorrect for one main reason: Talented workers will continue to expect benefits from companies, so companies can’t stop offering them altogether.

After all, recruiting and retaining the best workers isn’t just about offering an attractive salary, especially not today. From this perspective, it should be obvious that the ACA would not eliminate almost all employer-provided insurance. And to be sure, there are more reasons than this alone.

Employers Have Their Own Reasons to Maintain Insurance Coverage

While small businesses have shown the greatest decline in employer coverage since the ACA became law, this was a trend that had already begun before the law came into effect. And since 2010, the percentage of small businesses offering health benefits decreased just 12 percent from 68 percent to 56 percent.

Employers have several reasons to provide coverage aside from just incentivizing a talented workforce to come and remain with the organization. After all, employers receive sizeable tax breaks for providing coverage. However, there are still employers who have moved employees to the exchanges. It’s important to note that these businesses are often those who employ low-income workers or are simply too small to provide adequate coverage.

So, What Does it Mean for the Future?

With the 2016 presidential election looming, no one is certain what will happen to healthcare coverage following the election. However, one thing is certain: There is currently no financial advantage to sway most employers from dropping coverage and moving to an alternative.

In the future, the same might hold true, depending on who becomes president and how they further reform health care. Until that point, we can only focus on what remains true now: Employers are still providing coverage, and employees are realizing the benefits.

So, what about your company? Have you continued to provide coverage for employees during the ACA? Why or why not? We look forward to reading your comments below!