Benchmark on Health Care Coverage Perceptions and Readiness

Benchmark on Health Care Coverage Perceptions and Readiness The First Annual Transamerica Center for Health Studies SM Survey September 2013 Transamerica Center for Health Studies, 2013 Transamerica Center for Health Studies, 2013

Table of Contents About the Transamerica Center for Health Studies Page 3 About the Survey Page 4 Methodology Page 5 Terminology Used Page 7 Iconography Used Page 8 Executive Summary Page 9 Recommendations for Affordable Care Act Readiness Page 15 Detailed Findings Page 16 The Current Health Care Landscape Page 16 Health Care Benefits Management Page 25 Health Care Priorities Page 36 Perception of and Preparation for the Affordable Care Act Page 44 Changes in the Future Page 56 The Impact of Company Size Page 61 Appendix Page 81 2

About the Transamerica Center for Health Studies SM The Transamerica Center for Health Studies (TCHS) informs the national health care conversation, bringing clarity to the complex decision-making regarding health coverage and personal health and wellness. Through its broad-based analysis and research findings, TCHS offers consumers and employers a guide to navigate the financial implications of the health care decisions they are facing. TCHS engages with the American public through national surveys, its website, research findings and consumer guidance. TCHS also collaborates with health care experts and organizations that are equally focused on health coverage and personal health and wellness. A division of the Transamerica Institute, a nonprofit, private foundation, TCHS is dedicated to identifying, researching and analyzing the most relevant health care issues facing consumers and employers nationwide. The Transamerica Institute is funded by contributions from Transamerica Life Insurance Company and its affiliates (not a major medical insurer) and may receive funds from unaffiliated third parties. 3

About the Survey The Transamerica Center for Health Studies SM (TCHS) has conducted a national survey of both the U.S. General Adult Population and businesses (Employers) regarding their attitudes toward health care and health insurance coverage as they face a shifting health care coverage landscape. The Survey took place in July 2013 and asked randomly selected Americans and Employers questions about their health care needs and preferences and also about their preparedness for and expectations relating to the Affordable Care Act. The overall goals for the study are to illuminate emerging trends, promote awareness, and help educate the public about healthcare and health coverage. The 2013 Survey is the first of what will be an annual nationwide health care survey. Harris Interactive was commissioned to conduct the survey for TCHS and it was conducted independently. TCHS is not affiliated with Harris Interactive. 4

Methodology: General Population Survey An 18-minute online survey was conducted July 9 22, 2013 among a nationally representative sample of 2,505 members of the U.S. General Adult Population using the Harris online panel. Among the respondents: All were U.S. residents aged 18 64. 1,704 were working (full-time, part-time, or self-employed). Data were weighted (statistically adjusted) on income, education, gender, race/ethnicity, region, employment status, number of employees in company, and health insurance status to: Account for differences between the population available via the Internet versus by telephone. Be a representative sample of the U.S. General Adult Population age 18-64. Percentages were rounded to the nearest whole percent. Differences in the sums of combined categories/answers are due to rounding. 5

Methodology: Employer Survey A 15-minute online survey was conducted July 15 29, 2013 among a nationally representative sample of 758 employers. Respondents were targeted based on company size and for-profit status and met the following criteria: Business executives who make decisions about employee benefits at his or her company. For-profit companies that employ 1 or more employees across all locations. Quotas were set for the following sizes: 1 9 employees, 10 49 employees, 50 99 employees, 100 499 employees, and 500 or more employees. Results were weighted as needed on employee size using weighting targets from the Survey Sampling International database to ensure each quota group had a representative sample based on the number of employees within each company size range. Percentages were rounded to the nearest whole percent. Differences in the sums of combined categories/answers are due to rounding. 6

Terminology This report uses the following terminology: General ACA: Affordable Care Act Gen Pop: General Adult Population Workers: Those among the Gen Pop who are full-time, part-time, or self-employed, unless otherwise noted Employers: Weighted sample of employers surveyed Company Size Small company: 1 49 employees (EEs) Micro company: 1 9 employees (EEs) Small non-micro company: 10 49 employees (EEs) Medium company: 50-499 employees (EEs) Large company: 500 or more employees (EEs) Generations Millennials : Those born 1979-1995 Younger Millennials: Those born 1989-1995 Older Millennials: Those born 1979-1988 Generation X: Those born 1965-1978 Baby Boomer: Those born 1946-1964 7

Iconography This report uses the following iconography: : Slide contains data from the Employer survey. : Slide contains data from the Gen Pop survey. Some slides show subsets of the Gen Pop (e.g., full-time, part-time, or self-employed Workers) rather than all of the Gen Pop. 8

Executive Summary The Transamerica Center for Health Studies SM (TCHS) is pleased to release its inaugural research report entitled The First Annual Transamerica Center for Health Studies SM Survey: Benchmark on Health Care Coverage Perceptions and Readiness. This report is intended to shed light on America s preparedness for the implementation of the forthcoming provisions of the Affordable Care Act (ACA) as of 2013 and continuing through 2015. It explores the preparations and preferences among the General Adult Population (Gen Pop) and Employers and, in comparing their views, it uncovers some disconnects along the way. Ultimately, this report aspires to outline key issues, areas of concern and opportunity, and ways that consumers, workers and employers can become better educated to make the most informed decisions about health insurance coverage. The extent that the Gen Pop and Employers feel informed about the ACA is mixed and many do not feel informed at all, despite the law s fast approaching requirement that individuals obtain coverage by January 1, 2014. Fewer than half of the Gen Pop (48 percent) report being informed about the ACA, however, only 11 percent are very informed. [page 46] The majority of Employers (70 percent) indicate being informed about the ACA, however, only 25 percent are very informed. [page 46] The majority of the Gen Pop and Employers indicate they are prepared to make health coverage decisions related to the ACA, but many have not taken any action to prepare. 63 percent of the Gen Pop and 73 percent of Employers report they are prepared to make health insurance choices after the individual and employer mandates go into effect. [page 52] Although the majorities of both groups say they are prepared, many of the Gen Pop (57 percent) and Employers (28 percent) said they had not taken any action in the past 12 months to prepare for the ACA. [page 55] 9

Executive Summary The 2014 mandate for individual health coverage is looming, especially for the 43 percent of the Gen Pop who do not have insurance through an employer. Many of them are still undecided about where they will obtain coverage. 43 percent of the Gen Pop does not currently have coverage through an employer and 21 percent do not have health insurance at all. [page 18] With the individual health coverage mandate taking effect in 2014, and open enrollment in the state exchanges starting October 1, 2013, among those who do not have health insurance through an employer: - 39 percent are not sure about where they will get health coverage - 36 percent plan to keep their current coverage - 17 percent plan to purchase health coverage through a state exchange - 8 percent do not plan to purchase insurance. [page 53] The lack of familiarity and preparedness, along with other unknowns about the ACA, is fueling paradoxical perceptions. The Gen Pop and Employers frequently cited cost and affordability of health insurance as both concerns and possible improvements that might result from the ACA. The majority of the Gen Pop (54 percent) are concerned that the cost of their health insurance coverage and that out-ofpocket expenses will increase. For Employers, the most frequently cited concern is higher costs to the company for Employee health coverage (38 percent). [pages 48-49] In terms of possible improvements resulting from the ACA, the Gen Pop most frequently cites an interest in a decrease in the costs of their health coverage and out-of-pocket expenses (44 percent). Similarly, among Employers, the ability to provide health coverage for all employees at an affordable cost (29 percent) and pay lower costs for employee health coverage (26 percent) are most frequently cited. [pages 50-51] 10

Executive Summary Workers and Employers agree on the importance of health insurance coverage; nevertheless, many Employers prefer the idea of providing a bonus/subsidy for their employees to receive health coverage elsewhere. Among full-time and part-time Workers, health coverage is the fourth most frequently cited factor in job satisfaction (55 percent responding very important) behind only salary/pay (70 percent), financial strength of company (57 percent), and work/life balance (56 percent). Employers also cite health care benefits fourth in attracting and retaining employees (48 percent indicate it is very important). [page 20] When presented with the two options of receiving health insurance through their Employer or receiving a bonus/subsidy to purchase insurance elsewhere: The majority of full-time and part-time Workers (71 percent) prefer to receive health coverage through their employer. Many Employers (64 percent) believe this is what employees prefer. [page 43] However, in contrast to employee preferences, Employers are more evenly split just over half of Employers (54 percent) prefer the option to provide health coverage and 46 percent prefer a bonus/subsidy for their employees to purchase coverage elsewhere. [page 43] Employers and Workers face directly conflicting interests regarding health insurance coverage: Employers prioritize lower costs over higher quality, while Workers prioritize higher quality over lower cost. The majority of Workers (62 percent) prefer to pay more for a higher quality health coverage option compared to only 38 percent who would prefer to reduce insurance costs even if it means lower quality. [page 41] In direct opposition, the majority of Employers (57 percent) prefer to reduce coverage costs even if it means a lower quality option. Only 43 percent of Employers prefer to pay more for a higher quality option. [page 41] 11

Executive Summary Despite concerns among many Employers that health coverage costs may rise due to the ACA, very few expect to drop their health coverage and the majority do not anticipate labor force reductions. Many Employers (41 percent) expect the ACA to negatively impact their company s health coverage costs in the next 2-3 years, while 27 percent expect a positive impact. The majority of Employers (59 percent) expect their company s benefits plan design to change. However, only 7 percent expect to remove health insurance in the next 1-2 years. [pages 57-59] Few Employers (19 percent) anticipate a reduction in employees as a result of the ACA. The majority of Employers (61 percent) do not anticipate any changes and, interestingly, 20 percent anticipate increasing employees. [page 60] An information gap exists where few Employers provide what Workers say they need to decide about health coverage options. Workers say they need the following information to make decisions about their health insurance options in the next 1-2 years: A description of the benefits available is needed by 51 percent of Workers. A comparison of how health insurance costs may change is needed by 50 percent of Workers. A comparison of coverage among plans available is needed by 47 percent of Workers. [page 35] Only 12 percent of Employers provide all three of these pieces of information. A description of the benefits available is provided by 47 percent of Employers. A comparison of how health insurance costs may change is provided by 24 percent of Employers. A comparison of coverage among plans available is provided by 30 percent of Employers. [page 35] Online tools and benefits advisors are seen as the most helpful channels for seeking health coverage-related information by Workers (59 percent and 47 percent, respectively) yet are less likely to be offered by Employers (40 percent and 32 percent, respectively). [page 33] 12

Executive Summary Small companies face unique circumstances and opportunities in light of the ACA. Small companies are far less likely to offer health care benefits to full-time Workers (50 percent vs. 95 percent of medium and 97 percent of large companies). [page 62] Small companies are more likely than medium or large companies to prefer reducing insurance costs even if it means a lower quality health coverage option (61 percent vs. 50 percent of medium and 55 percent of large companies). [page 64] Small companies (32 percent) are more likely to be dissatisfied with current health insurance options than medium (16 percent) or large (11 percent) companies. [page 67] Small companies are more likely to be uninformed about their health coverage options (28 percent vs. 8 percent of medium and 14 percent of large companies) and uninformed about changes in the health care industry that impact their health care coverage options (30 percent vs. 12 percent of medium and 17 percent of large companies). [pages 68, 70] Specific to the ACA, 39 percent of small companies report being not very or not at all informed about the ACA compared to large (35 percent) and medium (22 percent) companies. [page 75] Lastly, almost half (49 percent) of small companies have not taken any actions in the past 12 months to prepare for the ACA, much higher than large (15 percent) or medium (12 percent) companies. [page 78] Despite conflicting views about costs and quality of health insurance coverage, Employers and the Gen Pop share common interests in wellness programs. The vast majority of Employers (83 percent) strongly or somewhat agree that implementing health/wellness and disease management programs lead to better control of health care costs. [page 31] The Gen Pop identified discounts for wellness services (31 percent) just behind low premiums, co-pays, and deductibles (40 percent) as elements missing from their health care options. [page 23] Additionally, when asked about potential approaches to health care, the majority of the Gen Pop (78 percent) indicated interest in receiving cash incentives or insurance premium discounts for healthy behaviors. [page 24] 13

Executive Summary In Conclusion The implementation of the ACA s 2014 mandate for individual health insurance and 2015 mandate for employer health insurance coverage over 50 employees, along with the formation of State Exchanges, requires individuals and employers to become educated about their options in order to make informed decisions. Relatively few Employers (25 percent) or members of the Gen Pop (11 percent) are very informed about the relatively new law. Many believe they are prepared to make decisions but few have taken action to prepare. Among those who do not currently receive health coverage through an Employer, many are unsure where they will obtain coverage when the individual mandate takes effect in 2014. Health insurance costs and quality are top of mind for all. Workers and Employers agree on the important role of health coverage in employment choices and job satisfaction; however, priorities among Workers and Employers are in direct conflict. Most Workers prefer a higher quality even if it means a higher cost. And many Employers are focused on minimizing costs even if it means a reduction in quality. Workers have also stated a need for information about their health coverage options that Employers are not yet providing. Despite concerns among many Employers that health costs may rise due to the ACA, few anticipate reducing the number of their employees due to the ACA. Even fewer expect to drop their health coverage in the next 1-2 years. Small companies face unique circumstances and opportunities. They are less likely to offer health coverage benefits and less satisfied with options available to them and less likely to be familiar with the ACA which will bring about new alternatives for their employees. Amidst the conflicting views, one thing that the Gen Pop and Employers agree on is the importance of wellness programs to promote healthy behavior. 14

Recommendations for Affordable Care Act Readiness Gen Pop/Workers 1. Look over communications from your employer regarding changes in health coverage, and be on the lookout for changes in providers and costs. 2. Ask your employer for additional information if you think it is needed to make informed decisions, such as details of plan options and plan comparisons. 3. Do not pick a plan only based on the lowest monthly premium or lowest annual deductible. Look closely at what is covered and how much you will have to pay out of pocket when you get care. 4. If you do not have health coverage through your employer, look up the health coverage options in your state exchange and/or consult with a benefits advisor/health consultant. 5. Get familiar with the ACA look up the resources at www.transamericacenterforhealthstudies.org. Businesses 1. Provide plan comparisons of costs and coverage features when giving health coverage information to employees. 2. Compare the pricing and benefits you receive for health coverage with what is available in your state exchange or Small Business Health Insurance Options Program (SHOP). 3. Get familiar with the Affordable Care Act (ACA) look up the resources at www.transamericacenterforhealthstudies.org. 4. If you have less than 25 employees, find out if you can qualify for tax incentives if you provide health insurance to your employees. Find out more at www.transamericacenterforhealthstudies.org. 5. Consider implementing an employee wellness program to keep your employees healthy and keep costs down. See if you can qualify for a federal grant to start your wellness program. Find out more at www.transamericacenterforhealthstudies.org. 15

The Current Health Care Landscape 16

Many Are Satisfied with the Quality of the Health Care System Seventy-nine percent of the Gen Pop are at least somewhat satisfied with the health care system to which they have access. However, only 29 percent are very satisfied. Satisfaction of Quality of Health Care System A similar majority of fulltime/part-time/self-employed Workers (79 percent) are satisfied with the quality of the health care system to which they have access. 100% 80% 60% 79 29 Very satisfied Somewhat satisfied 40% 50 Not very satisfied Not at all satisfied 20% 13 0% 8 Total Gen Pop BASE: Total Gen Pop (n=2505) Q730. Overall, how satisfied are you with the quality of the health care system you have access to today? When we say health care system we are referring to all things related to health care including doctors, nurses, and other health care providers, hospitals, insurance, etc. 17

Employers Are the Most Cited Source of Health Insurance Most of the Gen Pop (57 percent) receive their health insurance primarily through an employer, and about one-fifth (21 percent) currently do not have health insurance.* Primary Health Insurance Benefits Received Through employer Through union 2 57 69 percent of Workers receive their health insurance primarily through an employer. 16 percent of Workers do not have health insurance. Through trade association 0 Buy own health insurance, not through work Receive benefits through Medicare Receive benefits through Medicaid or other state funded program 5 5 8 Those working part-time (35 percent) or not working (30 percent) are more likely not to have health insurance compared to those working fulltime (13 percent). Receive benefits through military service Receive VA benefits from own or spouse's service 1 2 Workers in small companies (29 percent) are more likely than those working in medium (15 percent) or large (11 percent) companies not to have health insurance. Do not have health insurance at this time 21 Those without a 4 year college degree (26 percent) are more likely than those with a college degree (10 percent) to not have health insurance. *Note: For comparison, the U.S. Census 2012 Current Population Survey (CPS) has an uninsured rate of 21 percent among Americans 18-64 years of age. BASE : Total Gen Pop (n=2505) Q602. Which of the following best describes how you primarily recieve health insurance benefits today? 18

Many Employers Do Not Offer Health Care Benefits to Any Employees The majority of Employers (78 percent) currently offer their full-time employees health care benefits while one fifth (21 percent) currently don t offer these to any employees. Only 14 percent offer benefits to parttime employees. Types of Employees Offered Health Care Benefits 78 Total Employers 14 Small companies (49 percent) are more likely than medium (5 percent), or large (2 percent) companies to offer no health care benefits to their employees. 21 Yes, full-time employees Yes, part-time employees No, none Companies that are not prepared for the ACA (39 percent) are more likely than those who indicate they are prepared (15 percent) to offer no health care benefits to their employees. *Note: Data for Employers was weighted based on the number of employees found within each company size. Therefore, direct comparisons to other surveys with employer data should keep this in mind. BASE: Total Employers (n=758) Q800. Does your company provide health care benefits to any of your employees? 19

Health Care Benefits Play a Role in Job Satisfaction Health care benefits was the fourth most cited important factor for job satisfaction among full-time and part-time Workers (55 percent say it is very important), and Employers indicate it is the fourth most important factor in attracting and retaining employees (48 percent say it is very important). Salary/pay Factors for Job Satisfaction 70 27 21 Factors for Attracting and Retaining Employees 56 35 4 6 Financial strength/stability of the company 57 35 5 3 49 40 6 5 Flexibility for work/life balance 56 35 7 3 43 43 7 7 Health care benefits 55 32 9 4 48 33 8 11 Retirement benefits 50 35 11 4 35 38 15 13 Support of direct manager 45 40 12 4 36 47 8 9 Team environment 38 45 13 4 39 43 10 8 Commute 39 43 14 4 24 44 17 14 Career advancement 37 43 15 5 35 39 15 11 Company s reputation in the industry 33 47 15 5 54 33 7 6 Company culture 34 44 17 5 37 44 11 9 Other benefits 35 45 16 4 29 45 14 12 Very important Somewhat important Not very important Not at all important BASE: Total full-time or part-time Workers (n=1615) Q1105. When thinking about your job/career, how important are each of the following factors in your overall job satisfaction? BASE: Total Employers (n=758) Q716. How important are each of the following attributes in your company s ability to attract and retain employees? 20

Quality in the Health Care System Consists of Different Elements The Gen Pop most frequently cites characteristics of quality, such as doctors having sufficient time to treat patients (42 percent), a focus on preventative care (40 percent), and technology to help doctors better understand and diagnose diseases (32 percent). Characteristics of Quality in the Health Care System Full-Time/Parttime/Self-Employed Workers Doctors having sufficient time to treat their patients A focus on preventative care Technology to help doctors better understand and diagnose diseases Universal access to health insurance Having a choice in health insurance plans Follow up care to keep people on the right track Prevention of hospital and facility-related infections Prescription medicines that help me better manage chronic diseases A focus on effective treatment to minimize the length of hospital stays Effective sharing of my health or medical information and coordination among all my healthcare providers Specialized surgeries that were not possible 10 years ago Standardization of processes to reduce mistakes Access to some basic healthcare procedures in more convenient places Other 3 22 22 18 17 16 14 13 13 11 10 32 42 40 42 43 33 21 21 18 16 14 16 13 12 12 10 3 BASE: Total Gen Pop (n=2505) Q735. When you think of the word quality in the health care system today, what are some of the characteristics that come to mind? Please select up to three characteristics from the following list that you associate most with quality. 21

Deep Knowledge of Health Insurance Options Is Low Among the General Population and Employers Most of the Gen Pop (75 percent) and Employers (81 percent) are at least somewhat informed about their personal and their company s health insurance options, but only 22 percent and 37 percent, respectively, are very informed. 100% Informed of Health Insurance Options 100% Informed of Health Insurance Options 80% 22 Very informed 80% 37 60% 40% 75 Somewhat informed 60% 81 53 Not very informed 40% 44 20% 19 Not at all informed 0% 6 0% Total Gen Pop Women (28 percent) are more likely not to feel Employees of small companies (32 informed compared to percent) are more likely than those men (22 percent). in medium (21 percent), or large (18 percent) companies to not feel informed. BASE: Total Gen Pop (n=2505) Q1000. How informed do you feel about your current options for health insurance (i.e., major medical insurance)? BASE: Total Employers (n=758) Q1005. Regardless of whether you offer insurance, how informed do you feel about your company s current options for health insurance (i.e., major medical health insurance)? 20% 13 6 Total Employers 22

Ways to Lower Health Care Costs Are the Most Cited Elements Missing from Health Care Options Low monthly premiums, co-pays, and deductibles (40 percent) and discounts for wellness services (31 percent) are the two most cited elements mentioned by the Gen Pop that are missing from their current health care options. Missing Elements from Current Health Care Options Low monthly premiums, co-pays, and/or deductibles Discounts for wellness services (e.g., dietician, fitness equipment) A wider variety of insurance plans to choose from Affordable access to brand name drugs Affordable access to the best doctors in my area 40 31 24 24 24 Baby Boomers (44 percent) are more likely than Younger Millennials (29 percent) to indicate low monthly premiums, co-pays, and/or deductibles as missing from their current health care options. Direct access to specialists Affordable access to the latest medical technologies Health insurance access for my family Coverage for specific items that my family or I need Physician or hospital reimbursement tied to patient outcomes Affordable access to specialty drugs for diseases like cancer, rheumatoid arthritis, or MS Access to a health advocate who can help me find the best doctors/hospitals and help me understand my medical bills None of the above 22 21 20 19 19 17 15 22 Baby Boomers (29 percent) are less likely than Older Millenials (37 percent) to indicate discounts for wellness services as missing from their current health care options. Workers (34 percent) are more likely than the Gen Pop to select discounts for wellness as missing from health care options. BASE: Total Gen Pop (n=2505) Q805. Which of the following elements are missing from your current health care options that are important to you? Please select all that apply. 23

High Level of Interest Exists in Different Approaches to Health Care Services When asked about possible approaches to health care, receiving cash incentives, or discounts on health insurance premiums for healthy behaviors (78 percent) and receiving primary care or disease management from a nurse practitioner or physician s assistant (68 percent) are the two proposed approaches to generate the most interest. Potential Approaches to Health Care Very/Somewhat Interested Receiving cash incentives or insurance premium discounts for healthy behaviors 78 Receiving regular primary care or disease management from a Nurse Practitioner or Physician's Assistant in lieu of a doctor for lower healthcare costs Receiving healthcare services and procedures from an Accountable Care Organization 64 68 Receiving routine healthcare procedures from clinics set up in retail locations rather than a doctor's office. 62 Receiving healthcare services and procedures from a Patient Centered Medical Home 61 BASE: Total Gen Pop (n=2505) Q800. How interested are you in each of the following potential approaches to health care? 24

Health Care Benefits Management 25

Employers Are Satisfied with Their Health Insurance Options The majority (80 percent) of all Employers, regardless if they currently offer health insurance, are satisfied with their company s current health insurance options. 100% Satisfaction with Health Insurance Options 80% 26 Very satisfied 60% 80 Somewhat satisfied 40% 54 Not very satisfied 20% 0% 13 7 Total Employers Not at all satisfied BASE: Total Employers (n=758) Q1007. Regardless of whether your company offers health insurance, how satisfied is your company with its current health insurance options? 26

Employers Evaluate Health Care Benefits Infrequently Most Employers (57 percent) review health care benefits offered about once a year. 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% % Frequency of Evaluating Health Care Benefits 12 57 13 14 Total Employers 4 About every six months About once a year About every two years or more Never Don t know Small companies (35 percent) are more likely than medium (3 percent) or large companies (0 percent) to never evaluate the health care benefits offered to employees. Companies that do not work with a benefits advisor (28 percent) are more likely than those that work with a benefits advisor (<1 percent) to never evaluate the health care benefits offered to employees. BASE: Total Employers (n=758) Q1000. How frequently does your company evaluate the health care benefits offered to employees? 27

Changes to Health Care Benefits Are Not Common Most Employers (68 percent) say their company has not made any changes in their health care benefits offerings in the past 12 months. Changes to Health Care Benefits Offered in Past 12 Months Large (37 percent) and medium (35 percent) companies are more likely than small companies (82 percent) to have made changes in the past 12 months. Companies working with a benefits advisor (42 percent) are more likely than those who don t work with a benefits advisor (14 percent) to have made changes in the past 12 months. 28 68 4 Yes No Don't know BASE: Total Employers (n=758) Q1010. In the past 12 months, has your company made any changes to the health care benefits it offers/offered? 28

Changes to Health Care Benefits Usually Involve Plan Options or Insurers Among those who have made changes in the past 12 months, the two most cited changes have been in plan options (38 percent) and insurers (31 percent). Kinds of Changes Made to Health Care Benefits in Past 12 Months Changed plan options Changed insurers 31 38 Added or increased company contribution to cover costs for health insurance Tightened requirements for employees to be eligible for health care benefits Added or increased company contribution to cover costs for health care benefits other than health insurance benefits Added health care benefits other than health insurance Reduced or eliminated company contribution to cover costs for health insurance Reduced or eliminated company contribution to cover costs for health care benefits other than health insurance Added health insurance Reduced or removed health care benefits other than health insurance Loosened requirements for employees to be eligible for health care benefits 16 15 15 14 14 13 12 8 8 Removed health insurance Other 3 5 BASE: Employers who made changes to health care benefits in the past 12 months (n=225) Q1015. What changes were made to the health care benefits your company offers? 29

Cost and Quality Are the most Cited Health Care Benefits- Related Priorities among Employers Minimizing the company s cost of providing health insurance to employees (18 percent) and providing the best health care benefits package possible (18 percent) are the two most cited health care benefits-related priorities among Employers. Company s Health Care Benefit-Related Priorities Minimizing the company s cost of providing health insurance to employees Providing the best health care benefits package possible Lowering insurance premiums for employees Lowering out-of-pocket health care costs to employees Expanding current health care benefits offerings Offering health insurance to all employees (both parttime and full-time) Adding additional health care benefits to supplement the health insurance plan currently offered Providing the minimum health care package necessary to attract and retain employees Other My company currently does not provide health care benefits 18 18 11 9 7 6 6 6 1 17 BASE: Total Employers (n=758) Q825. Which one of the following is your company s most important health care benefits-related priority right now? 30

Employers Understand the Positive Impact of Offering Health Care Benefits Eighty-four percent of Employers strongly or somewhat agree that providing health care benefits helps keep employees healthy, leading to better productivity. Health Care Benefit Attitudes Health care benefits help keep employees healthy, leading to better productivity Implementing health/wellness and disease management programs lead to better control of health care costs Health care benefits help to boost employee morale Health care benefits help keep and retain employees with the company Health care benefits help to attract quality employees to the company Our employees need to play a bigger role in managing their own health care costs Our employees view their health care benefits as a requirement of their compensation package 84 83 83 83 82 76 73 Health care benefits are a more affordable alternative to pay increases or bonuses Our company offers generous health care benefits to compensate for lower salaries 53 52 BASE: Total Employers (n=758) Q830. How much do you agree or disagree with the following statements? 31

Many Employer Decision-Makers Do Not Have Roles in Discussing Health Care Benefits with Employees About half (48 percent) of Employers are not involved in talking to employees directly about health care benefits. Role in Discussing Health Care Benefits with Employees 37 48 15 Educator Consultant/Advisor My role does not involve talking to employees directly about health care benefits Decision-makers in small companies (56 percent) are more likely than those in medium (38 percent), or large companies (45 percent) to not be involved in talking directly to employees about health care benefits. Decision-makers whose companies do not offer health care benefits (66 percent) are more likely than those who offer health care benefits (44 percent) to not be involved in talking directly to employees about health care benefits. BASE: Total Employers (n=758) Q1335. When it comes to discussing health care benefits with your employees, are you more of an 32

Employers Offer Several Channels Workers Find Helpful When Seeking Health Insurance-Related Information Employers cite online tools and employee benefits advisors as the options most often provided to employees for advice about health care benefits, but less than half (40 percent) of Employers reported any single option as being provided to their employees. Helpful Options When Seeking Health Insurance-Related Information Options Offered by Company Regarding Education or Advice on Health Insurance Online tools and resources 59 Online tools and resources 40 Employee benefits advisor 47 Employee benefits advisor 32 Printed brochures and flyers sent in the mail 36 Group meetings, workshops, or seminars 32 One-on-one counseling 31 Printed brochures and flyers sent in the mail 31 Informative emails Group meetings, workshops, or seminars Other 5 23 31 Younger Millenials (49 percent) are more likely than Baby Boomers (24 percent) to find one-on-one counseling useful. Informative emails One-on-one counseling Other 9 15 30 Not sure 9 Not sure 18 BASE: Full-time, part-time, or self-employed Workers and offered/have acces to health care benefits (n=1426) Q1120. When seeking information and/or advice about health care benefits, saving for health care costs, or planning for health care costs, which of the following options do you find helpful? Please select all that apply. BASE: Total Employers (n=758) Q1100. Which of the following options does your company, insurance plan provider or benefits advisor offer to your employees regarding education and/or advice about health care benefits, saving for health care costs, or planning for health care costs? 33

Engagement with Employees on Health Care Benefits Offered Is Infrequent Additionally, Employers generally engage with their employees a few times a year (21 percent) or annually (32 percent) regarding giving education or advice about the health care benefits offered. A fifth (21 percent) never engage with their employees about the company-provided health care benefits. Frequency of Company Engaging with Employees about Health Care Benefits Offered Only during initial enrollment period 10 Monthly 9 A few times a year 21 Annually Every few years 4 32 Companies that do not offer health care benefits (70 percent) are more likely than those that offer health care benefits (7 percent) to never engage their employees. Never 21 Don t know 4 BASE: Total Employers (n=758) Q1105. How often does your company proactively engage employees in education and/or advice about the health care benefits your company offers? 34

Workers Need Comparative Information about Health Insurance Compared to Employers, a higher proportion of Workers indicate they need a comparison of costs (50 percent vs. 24 percent) and coverage of available health insurance plans (47 percent vs. 30 percent) and an unbiased resource (40 percent vs. 16 percent). 34 34 32 40 51 50 47 Information Provided by Company to Help Employees Make Informed Health Insurance Decisions 1 A description of what benefits are available What benefits are available 1 2 3 Information Needed by Workers (Full-Time/Part- Time/Self-Employed) to Make Informed Health Insurance Decisions A comparison of how the cost of health insurance may change from what I pay now A comparison of coverage among health insurance plans that are available An unbiased resource on my options/choices A comparison of how access to doctors and health care providers may change A quality rating of doctors in the network Materials from my employer on options/choices A comparison of how the cost (premiums, co-pays, etc.) of health insurance may change from what they pay now A comparison of coverage among health insurance plans that are available An unbiased resource on their options/choices A comparison of how access to doctors and providers may change from what is available to them now A quality rating of doctors in the network Materials from my company on options/choices 16 19 17 24 30 33 47 3 2 Information on health care exchanges 24 A list of questions that I should be asking my employer Other None- I don t need any information BASE: Full-time, part-time, or self-employed Workers (n=1704) Q1025. What information do you need to make an informed decision regarding your health insurance options in the next 1 2 years? Please select all that apply. BASE: Total Employers (n=758) Q1102. What information, if anything, do you provide so that your employees can make informed choices about their health insurance options? Please select all that apply. 2 15 24 Only 12 percent of Employers provide all three pieces of information. Other None of the above 1 26 35

Health Care Priorities 36

Most People Are Not Actively Saving for Health Care Expenses The majority (74 percent) of the Gen Pop currently isn t saving for health care expenses. Currently Saving for Health Care Expenses 26 Those who do not have a 4 year college degree (79 percent) are more likely than those with a college degree (64 percent) to not be saving for health care expenses. 74 Workers in small companies (77 percent) have the highest proportion of not saving for health care expenses compared to those in medium (69 percent) or large (64 percent) companies. Yes No BASE: Total Gen Pop (n=2505) Q755. Are you currently saving for health care expenses, in accounts such as a flexible spending account (FSA), health savings account (HSA), bank account, etc.? 37

Workers Are Not Taking Advantage of FSAs and HSAs Twenty-eight percent of Workers have access to a flexible spending account but do not participate and 22 percent of Workers have access to a health savings account but do not participate. Health Care Benefits Offered at Workplace Health insurance 61 17 16 6 Dental insurance 52 18 21 9 Vision insurance 41 19 27 12 Disability insurance 35 21 27 17 Flexible spending account 22 28 33 18 Hospital Intensive Care 22 11 35 32 Health savings account 21 22 36 20 Long-term care insurance 20 22 36 23 Hospital Confinement Indemnity 14 11 39 36 Critical illness insurance 13 14 39 34 Cancer insurance 8 14 46 32 Other 9 7 31 53 Enrolled/Available to buy Not offered/not available to buy Offered not enrolled/available but do not buy Don t know if offered or available to buy BASE: Full-time, part-time, or self-employed Workers (n=1704) Q1110. Now, we would like to ask you some questions about specific health care benefits. Which of the following health care benefits does your company offer you, personally, even if you choose not to participate? 38

Most People Say They Are Able to Afford Health Care Expenses In light of the lack of saving for health care expenses, a strong majority (71 percent) of the Gen Pop indicate they are able to afford their routine health care expenses. However, that still leaves 29 percent of the Gen Pop who are unable to afford routine health care expenses. Able to Afford Routine Health Care Expenses 71 Employees of small companies (31 percent) are more likely than employees in medium (22 percent) or large companies (22 percent) to indicate they are not able to afford current health care expenses. 29 Yes No BASE: Total Gen Pop (n=2505) Q760. Are you currently able to afford your routine health care expenses (health insurance co-pays, deductibles, out-of-pocket expenses, etc.)? 39

Women Feel Less Able to Afford Health Care Expenses Women (68 percent) are less likely than men (75 percent) to say they are able to afford routine health care expenses in fact nearly one-third (32 percent) of women say they are not able to afford them. Able to Afford Routine Health Care Expenses Men Women 75 25 Yes No 68 32 BASE: Total Gen Pop (Male N=1072, Female N=1433) Q760. Are you currently able to afford your routine health care expenses (health insurance co-pays, deductibles, out-of-pocket expenses, etc.)? 40

Workers and Employers Have Conflicting Priorities Regarding Trade-Off between Quality and Price for Health Insurance The majority (62 percent) of Workers have a preference for higher quality over lower price regarding health insurance while the majority (57 percent) of Employers have a preference for lower price over quality. Health Insurance Quality vs. Price I would prefer to pay more for a higher quality health insurance option 62 My company would prefer to pay more for a higher quality health insurance option. 43 I would prefer to reduce my insurance costs even if it means a lower quality health insurance option 38 My company would prefer to reduce insurance costs even if it means a lower quality health insurance option. 57 Total Full/Part-time/Self-Employed Total Employers BASE: Total full-time, part-time or self-employed Workers (n=1704) Q1040. Which of the following statements is closer to your view? BASE: Total Employers (n=758) Q935. Which of the following statements is closer to your company s view? 41

Workers and Employers Agree on Job Offer Preferences The Gen Pop that is working or searching for work is fairly split on their preference for a higher salary vs. excellent health care benefits (51 percent vs. 49 percent). Employers are almost equally as split regarding their beliefs about what potential employees prefer (53 percent for higher salary vs. 47 percent for excellent health care benefits). Excellent Health Care Benefits vs. Higher Salary A higher than expected salary, but reduced or minimal health care benefits 51 A higher than expected salary, but reduced or minimal health care benefits 53 Excellent health care benefits, but only meets your minimum salary requirements 49 Excellent health care benefits, but only meets their minimum salary requirements 47 Employed or Looking for Work Total Employers BASE: Full-time, part-time, or self-employed workers or unemployed but looking for work (n=1888) Q1125. Suppose that two job offers come your way. Which of the following job offers would you choose? BASE: Total Employers (n=758) Q930. Suppose your company could offer the following two choices in a job offer to a potential employee. Which one of the following options do you feel would be of greater preference to a potential employee? 42

Workers Prefer to Receive Health Insurance through Employer Although full-time and part-time Workers overwhelmingly prefer (and the majority of Employers also acknowledge their employees would prefer) to receive health insurance through their Employer (71 percent and 64 percent, respectively), Employers are split in their company s preference in continuing to provide health insurance directly. Preferred Methods of Obtaining Health Insurance Preferred Methods of Obtaining Health Insurance by Employees Receiving health insurance benefits through my employer as part of a benefit package 71 Receiving health insurance benefits through your company as part of a benefits package 54 64 Receiving a bonus or subsidy from my employer for the same amount as a health insurance benefits package to purchase my own health insurance independently 29 Receiving a bonus or subsidy from your company for the same amount as a health insurance benefits package to purchase their own health insurance independently 36 46 Employees in small companies (36 percent) are more likely than employees in medium (25 percent) or large (26 percent) companies to prefer receiving a bonus or subsidy to buy their own health insurance. Your employees Total Employers Your company BASE: Full-time or part-time Workers (n=1615) Q1145. Which of the following methods of obtaining health insurance would you prefer, assuming the costs to you were the same? BASE: Total Employers (n=758) Q918/Q919. Thinking about your employees, which of the following methods of obtaining health insurance do you think your employees would prefer assuming the costs to them were the same? And how about your company? 43

Perception of and Preparation for the ACA 44

Employers Indicate Being Informed about Changes in the Health Care Industry Over three quarters (79 percent) of Employers are informed about changes in the health care industry that impact their company s health care benefit options. In contrast, the percentage of small companies (30 percent) that indicate they are not at all informed is almost double either those in medium (12 percent) or large (17 percent) companies. 100% Informed about Changes in the Health Care Industry that Impact Health Care Benefit Options 80% 24 Very informed 60% 40% 20% 0% 79 54 16 6 Total Employers Somewhat informed Not very informed Not at all informed Small companies (30 percent) are more likely than medium (12 percent) or large (17 percent) companies to indicate they are not informed about changes in the health care industry that impact health care benefits options. BASE: Total Employers (n=758) Q1200. In general, how informed do you consider yourself to be on the health care industry changes that impact your company s health care benefits options, including changes to health insurance? 45

Level of Being Informed about the ACA Differs Between the Gen Pop and Employers A much higher proportion of Employers (70 percent) feel informed about the ACA compared to a little less than half (48 percent) of the Gen Pop feeling informed about the ACA. Informed about the ACA 100% 80% 60% 40% 20% 0% 48 52 11 37 31 21 Total Gen Pop Those who are not informed are more likely to: Be women Be unemployed Not be college graduates Have household incomes of less than $100,000 per year Very informed Somewhat informed Not very informed Not at all informed BASE: Total Gen Pop (n=2505) Q1915. How informed are you about the Patient Protection and Affordable Care Act, also known as health care reform or the ACA? BASE: Total Employers (n=758) Q1300. How informed are you about the Patient Protection and Affordable Care Act, also known as health care reform or the ACA? 100% 80% 60% 40% 20% 70 30 25 45 20 10 0% Total Employers Small companies (39 percent) are more likely not to be informed than medium (22 percent) or large (25 percent) companies. Specifically, micro companies (44 percent) are more likely not to be informed than small non-micro companies (31 percent). 46

Level of Being Informed about Aspects of the ACA Varies While there is an overall feeling among the Gen Pop of not being informed about the ACA (52 percent), there are strong majorities of those who feel informed about certain specific aspects of the ACA. The Gen Pop is least informed (39 percent) about subsidies for families earning less than $92,000 per year. Very/Somewhat Informed about Aspects of the ACA Allowing everyone eligible to qualify for health insurance, even if they have pre-existing conditions Requiring everyone eligible to have health insurance or pay a penalty for opting out Providing coverage under their parents' plan for children up to age 26 Requiring all eligible businesses with 50+ employees to provide or pay for health insurance 62 62 62 60 Creating state health insurance exchanges(either run by the state or federal government) where everyone eligible can buy insurance coverage Expanding state Medicaid programs to cover more people who previously wouldn't have been eligible No annual or lifetime limits on health coverage 47 45 50 Providing some eligible individuals and families who earn less than $92,000 per year with government subsidies that lower the cost of health insurance plans 39 BASE: Total Gen Pop (n=2505) Q1925. How informed are you about the following aspects of the ACA? 47

Increased Costs Is the Most Cited ACA Concern among the Gen Pop A majority (54 percent) of the Gen Pop is concerned that the costs of health insurance and out-of-pocket costs will increase. Concerns about the ACA Costs of my health insurance and out-of-pocket expenses will increase The quality of health care I will have access to will decline because more people will be seeking health care services, putting a strain on resources The health insurance plans I will have access to will be low quality plans My employer will reduce or even remove health care benefits I will have less access to affordable health care I will have access to fewer specialist physicians I will have less health insurance plans to choose from I will have access to fewer general or family practice doctors I will have less access to the latest medical technologies I will have less access to brand name drugs Government in charge/socialized medicine Being penalized/fined for not having insurance I have no concerns about the ACA 1 1 38 36 33 32 30 28 27 26 23 25 54 BASE: Total Gen Pop (n=2505) Q1927. Below is a list of hypothetical concerns about the ACA. Please indicate your biggest concerns about the ACA. 48

Employer ACA Concerns Center on Costs and Administrative Burden The primary concerns companies have about the ACA are higher costs to continue subsidizing or completely paying for employee health care benefits (38 percent) and higher administrative burden to satisfy new health care benefits-related regulations (33 percent). Concerns about the ACA Higher costs for the company to continue subsidizing or completely paying for employee health care benefits 38 Higher administrative burden for the company to satisfy new regulations related to health care benefits The company will have to reduce or even remove health care benefits they are currently providing due to cost The overall quality of health care for the company's employees will decrease and negatively impact productivity The company will have to reduce employee hours or reduce the number of employees to keep health care benefits affordable for the company Employee morale will decrease due to the changes in health care benefits being offered Attracting new employees will be more difficult as our health care benefits won't be as appealing Employee retention will become an issue due to the changes in health care benefits being offered 33 27 26 25 22 19 18 Other 1 The company has no concerns resulting from the ACA 26 BASE: Total Employers (n=758) Q1310. Please indicate your company s biggest concerns about the ACA. Please select all that apply. 49

Gen Pop Interest in ACA Improvements Are Related to Reduced Costs and Increased Access to Coverage In contrast to their cost-related concerns, decreases in the costs of health insurance and out-of-pocket expenses (44 percent) and more access to affordable health care coverage (37 percent) are the two possible impacts that receive the most interest among the Gen Pop. Interest in Improvements Resulting from the ACA Costs of my health insurance and out-of-pocket expenses will decrease I will have more access to affordable health care coverage I will no longer be discriminated against due to pre-existing conditions I will have access to health care coverage My employer will be able to offer more affordable health insurance I will have more access to a larger variety of health insurance plans I will have more access to advanced, sophisticated procedures, medication, and medical devices I will have more access to health care that is more focused on preventative care instead of diagnosis and treatment I will have more access to specialist physicians Physicians or hospitals will be reimbursed based on patient outcomes (such as improvement in a patient's illness) I will have more access to general or family practice doctors I will have more access to health insurance plans that provide coverage for my dependents Other The ACA will provide no improvements I'm interested in 2 18 31 31 29 28 26 26 25 23 22 26 37 44 Workers in small companies (26 percent) are less interested than Workers in medium (38 percent) or large (36 percent) companies to in their company hypothetically being able to offer more affordable health insurance.. BASE: Total Gen Pop (n=2505) Q1928. Below is a list of hypothetical improvements resulting from the ACA. Please indicate the improvements you are most interested in. 50

Employer Interest in ACA Improvements Focuses on Affordability of Providing Health Care Benefits Being able to provide health care benefits for all employees at an affordable cost (29 percent) and lower costs to continue subsidizing or completely paying for employee health care benefits (26 percent) are the two most common hypothetical improvements Employers are interested in. Interest in Improvements Resulting from the ACA The company can provide health care benefits for all employees at an affordable cost Lower costs for the company to continue subsidizing or completely paying for employee health care benefits The overall quality of health care for the company's employees will improve and positively impact productivity The company can push more of the administrative burden to employees to choose their own health insurance benefits The company can offer additional health care benefits to attract better employees Employee morale will improve due to the changes in health care benefits being offered Other 1 29 26 23 21 19 18 Small companies (47 percent) are more likely than medium (31 percent) or large (56 percent) companies to indicate the ACA will provide no improvements they are interested in. Companies that are not prepared for the ACA (48 percent) are more likely than those who are prepared (31 percent) to indicate the ACA will provide no improvements they are interested in. The ACA will provide no improvements the company is interested in 36 BASE: Total Employers (n=758) Q1315. Below is a list of hypothetical improvements resulting from the ACA. Please select the improvements that your company is most interested in. Please select all that apply. 51

Many Feel Prepared to Make Health Insurance-Related Decisions as a Result of the ACA Majorities of the Gen Pop (63 percent) and Employers (73 percent) are prepared to make decisions regarding their health insurance options once the ACA mandates go into effect. 100% Preparedness to Make Health Insurance Choices after the ACA Mandate Preparedness of Company to Make Health Insurance Choices after the ACA Mandate 100% 80% 25 Very prepared 80% 28 60% 63 38 Somewhat prepared 60% 73 45 40% Not very prepared 40% 20% 0% 23 15 Total Gen Pop Not at all prepared BASE: Total Gen Pop (n=2505) Q1940. As you may know, the ACA insurance mandate will go into effect in January 2014 and January 2015. In January 2014, individuals will need to have health insurance or pay a fine for opting out of health insurance. In January 2015, employers with 50 or more employees will be required to provide health insurance for all full-time employees. Knowing this, how prepared are you to make decisions regarding your health insurance choices by then? BASE: Total Employers (n=758) Q1322. How prepared is your company to make decisions regarding health insurance choices for your employees by then? 20% 0% Workers in small companies (58 percent) are less likely than Workers in medium (68 percent) or large (70 percent) companies to feel prepared. Overall 67 percent of workers feel prepared. 16 12 Total Employers 52

Uncertainty Exists for Uninsured after ACA Goes into Effect Among those who currently don t have health insurance through an Employer, 39 percent indicate they aren t sure what they ll do when the individual mandate goes into effect in January 2014. About a fifth (17 percent) indicate they will purchase health insurance through their State Exchange. Plans after ACA Mandate Goes into Effect for Those Who Don t Have Health Insurance through an Employer Of note, only 8 percent say they will not purchase health insurance. Women (44 percent) are more likely than men (33 percent) to be unsure of what they will do. 17 8 36 Purchase health insurance in my state exchange Pay the fine instead of purchasing health insurance Those who are not prepared for the ACA (56 percent) are more likely than those who are prepared for the ACA (22 percent) to say they are not sure what they will do. 39 Keep the health insurance I currently have Not sure BASE: Currently do not have health insurance through an employer (n=955) Q1942. With the ACA s insurance mandate for individuals beginning in January 2014, which of the following do you plan to do? 53

Vast Majority across Generations Are Not Planning to Pay the Fine After the individual mandate for the ACA goes into effect, 8 percent of the total Gen Pop who currently do not have health insurance through an employer plan on paying the fine instead of purchasing health insurance. This is consistent across generations, even among Younger Millennials. 100% 80% 60% 40% Plans after ACA Mandate Goes into Effect for Those Who Don t Have Health Insurance through an Employer 19 22 8 11 46 32 17 13 8 27 39 7 Purchase health insurance in my state's health insurance exchange Pay the fine instead of purchasing health insurance Keep the health insurance I currently have 20% 27 35 48 41 Not sure 0% Younger Millennials Older Millennials Generation X Baby Boomer Younger Millennials (born 1989-1995, n=88), Older Millennials (born 1979-1988, n=149), Generation X (born 1965-1978, n=239), and Baby Boomer (born 1946-1964) BASE: Currently do not have health insurance through an Employer (n=479) Q1942. With the ACA's insurance mandate for individuals beginning in January 2014, which of the following do you plan to do? 54

Many Have Not Taken Any Action to Prepare for ACA More than half (57 percent) of the Gen Pop have done nothing to prepare for the ACA while a little over a quarter (28 percent) of Employers have done nothing to prepare either. Discussed it with my friends/family Actions Taken to Prepare for the ACA in Past 12 Months 23 Actions Taken by Employer to Prepare for the ACA in Past 12 Months Researching details of the ACA 31 Researched possible new health insurance options Started saving more money to cover future health care expenses Calculated health care expenses for me and/or my family Spoken to my health care providers about possible changes in access to their services Spoken to my employer or HR about possible changes in health care benefits Spoken to my current health insurance company about possible changes in service Like the Gen Pop, 57 percent of Workers have done nothing to prepare. Other Nothing 15 9 8 8 8 6 3 57 Consulting with benefits advisors Calculating possible costs of health care benefits options in the future Consulting the company s current health care providers about possible changes in services/costs Meeting internally to discuss or plan for changes Consulting with industry experts Researching possible new health care benefits providers Considering replacing full-time workers with part-time or contract workers Researching reductions in employees or full-time employees Other Not taking any actions at this time 2 30 26 24 22 20 19 17 13 28 Employers not considering replacing fulltime workers with part-time or contract workers and not researching reductions in employees or full-time employees (NET): 76 percent Total Gen Pop BASE: Total Gen Pop (n=2505) Q1945. What action, if any, have you taken in the past 12 months to prepare for the ACA? Please select all that apply. BASE: Total Employers (n=758) Q1325. What actions is your company taking in preparation for changes related to the ACA? Please select all that apply. Total Employers 55

Changes in the Future 56

Employers Are Mixed about the Impact of the ACA on Employer s Health Care Costs Although 41 percent of Employers expect the ACA will have a negative impact on their company s health care benefits costs in the next 2-3 years, 22 percent expect that the ACA will have no impact and 27 percent expect a positive impact. 100% 80% 60% 40% 20% % Impact of the ACA on Employer s Health Care Costs in the Next 2-3 Years 27 41 8 19 22 25 16 10 Total Employers Very positive Somewhat positive No impact Somewhat negative Very negative Don t know BASE: Total Employers (n=758) Q1320. Given what you know about the ACA, what kind of an impact do you think it will have on your company s health care benefits costs in the next 2 3 years? 57

Employers Expect at Least Some Changes to Benefit Design Due to the ACA The majority of Employers also expect a lot (18 percent) or some (41 percent) change to their overall benefit design in the next 2-3 years due to the ACA. Changes to Benefits Design as a Result from the ACA 100% 18 80% A lot of change 60% 40% 20% 0% 41 29 12 Total Employers Some change No change Don t know BASE: Total Employers (n=758) Q1330. Over the next 2 3 years, how much change to the overall benefits design (not just limited to health care benefits) do you envision your company making as a result of the ACA? 58

Employers Anticipate Less Change to Health Care Benefits in Immediate Future In the more immediate 1-2 years, about a quarter (26 percent) of Employers expect to change plan options related to their company s health care benefits while a little less than 4 in 10 (37 percent) don t expect any changes to their company s health care benefits. Changes to Company Health Care Benefits in Next 1-2 Years Change plan options Reduce or eliminate company contribution to cover costs for health insurance Tighten requirements for employees to be eligible for health care benefits Reduce or remove health care benefits other than health insurance Reduce or eliminate company contribution to cover costs for health care benefits other than health insurance Change insurers Add health care benefits other than health insurance Add or increase company contribution to cover costs for health insurance Add or increase company contribution to cover costs for health care benefits other than health insurance benefits Add health insurance Remove health insurance Loosen requirements for employees to be eligible for health care benefits Other None - I don't expect any changes 14 12 10 10 9 8 8 8 7 7 5 2 26 37 BASE: Total Employers (n=758) Q1025. What changes, if any, do you expect will be made to your company s health care benefits in the next 1 2 years? 59

Few Employers Expect a Decrease in Number of Employees as a Result of the ACA Over 4 in 10 (43 percent) of Employers report that in the next 1-2 years, the number of employees at their company will increase. However, when the ACA is introduced for the same timeframe, less say that it will increase (20 percent) and more (61 percent) expect the number of employees in their company to stay the same. Change in Number of Employees in Next 1-2 Years Change in Number of Employees as a Result of the ACA 43 45 Increase Stay the same Decrease 20 19 61 11 BASE: Total Employers (n=758) Q710. Over the next 1-2 years, do you anticipate your company will increase, decrease, or have no changes in its number of employees? Q1332. Over the next 2 years, do you anticipate your company will increase, decrease, or have no changes in its number of employees as a result of the ACA? 60

The Impact of Company Size 61

Small Companies Are Most Likely Not to Offer Health Care Benefits to Any Employees Small (50 percent) companies are least likely to offer health care benefits to their full-time employees compared to medium (95 percent) and large (97 percent) companies. Among companies of all sizes, parttime employees are far less likely to be offered health insurance. Employers Offering Health Care Benefits 95 97 To Full-time employees To Part-time employees 50 49 To No Employees 22 6 13 5 2 Small Companies (1-49 EEs) Medium Companies (50-499 EEs)** Large Companies (500+ EEs) BASE: Total Employers (small n=283, medium n=355, or large n=120) Q800. Does your company provide health care benefits to any of your employees? 62

Small Companies Are Least Likely to Prioritize Providing the Best Health Care Benefits Package Available Medium (23 percent) and large (22 percent) companies are more likely than small (11 percent) companies to prioritize providing the best health care benefits package available. Minimizing the company's cost of providing health insurance to employees Providing the best health care benefits package possible Lowering insurance premiums for employees Lowering out-of-pocket health care costs to employees Expanding current health care benefits offerings Offering health insurance to all employees (both part-time and full-time) Adding additional health care benefits to supplement the health insurance plan currently offered (e.g. vision, dental) Providing the minimum health care package necessary to attract and retain employees Other My company currently does not provide health care benefits Health Care Benefits Priorities 2 1 1 3 5 5 6 5 6 5 5 8 7 8 7 9 9 10 11 14 13 13 13 20 22 Small Companies (1-49 EEs) Medium Companies (50-499 EEs) Large Companies (500+ EEs) 23 22 40 BASE: Total Employers (small n=283, medium n=355, or large n=120) Q825. Which one of the following is your company s most important health care benefits-related priority right now? 63

Small Companies Prioritize Lower Health Insurance Costs and Higher Salaries Small companies are more likely to prefer lower quality health insurance for reduced costs (61 percent) and they are more likely to believe that potential employees would prefer a higher salary in lieu of health care benefits (59 percent) compared to medium (50 percent, 50 percent) or large (55 percent, 49 percent) companies. Preference between Health Insurance Quality and Price My company would prefer to pay more for a higher quality health insurance option. 39 50 45 My company would prefer to reduce insurance costs even if it means a lower quality health insurance option. 61 50 55 Small Companies (1-49 EEs) Medium Companies (50-499 EEs) Large Companies (500+ EEs) Employee Preference for Potential Job Offers A higher than expected salary, but reduced or minimal health care benefits 59 50 49 Excellent health care benefits, but only meets their minimum salary requirements 41 50 51 Small Companies (1-49 EEs) Medium Companies (50-499 EEs) BASE: Total Employers (small n=283, medium n=355, or large n=120) Q930. Suppose your company could offer the following two choices in a job offer to a potential employee. Which one of the following options do you feel would be of greater preference to a potential employee? BASE: Total Employers (small n=283, medium n=355, or large n=120) Q935. Which of the following statements is closer to your company s view? Large Companies (500+ EEs) 64

Small Companies Evaluate Health Care Benefits Less Frequently Compared to medium and large companies, small companies either never evaluate the health care benefits they offer to their employees (35 percent) or just do it about once a year (43 percent). Within the small company segment, micro companies (50 percent) are much more likely to never evaluate health care benefits offered compared to small, non-micro companies (9 percent). Frequency in Evaluating Health Care Benefits 6 Small Companies (1-49 EEs) Medium Companies (50-499 EEs) 17 17 Large Companies (500+ EEs) 43 66 66 12 11 14 About every six months 35 3 0 About once a year About every two years or more 4 3 3 Never Don t know % 50% 100% % 50% 100% % 50% 100% Micro companies (50 percent) are more likely than small, non-micro companies (9 percent) to never evaluate the health care benefits offered to employees. BASE: Total Employers (small n=283, medium n=355, or large n=120) Q1000. How frequently does your company evaluate the health care benefits offered to employees? 65

More Small Companies Have Not Made Changes to Their Health Care Benefits Offerings in the Past Year Small companies (82 percent) are more likely than large (57 percent) or medium (63 percent) companies to have not made changes in the past 12 months to the health care benefits offered. Changes to Health Care Benefits Small Companies (1-49 EEs) Medium Companies (50-499 EEs) Large Companies (500+ EEs) 82 15 63 35 57 37 Yes No Micro companies (1-9 EEs) are more likely than small non-micro companies (10-49 EEs) to have not made changes in the past 12 months (88 percent and 71 percent, respectively). BASE: Total Employers (small n=283, medium n=355, or large n=120) Q1010. In the past 12 months, has your company made any changes to the health care benefits it offers/offered? 66

Small Companies Are Less Satisfied with Their Health Insurance Options Large (88 percent) and medium (84 percent) companies are more likely than small (68 percent) to be satisfied with their current health insurance options. Satisfaction with Health Insurance Options Small Companies (1-49 EEs) 14 18 42 26 Medium Companies (50-499 EEs) 3 13 57 26 Large Companies (500+ EEs) 2 9 62 26 0% 20% 40% 60% 80% 100% Micro companies (1-9 EEs) are more likely than small non-micro companies (10-49 EEs) to not be satisfied with their current health insurance options (36 percent and 24 percent, respectively). Not at all satisfied Not very satisfied Somewhat satisfied Very satisfied BASE: Total Employers (small n=283, medium n=355, or large n=120) Q1007. Regardless of whether your company offers health insurance, how satisfied is your company with its current health insurance options? 67

More Small Businesses Do Not Feel Informed about the Health Insurance Options Available Small (28 percent) companies are more likely to not feel informed about their company s current health insurance options compared to large (14 percent) and medium (8 percent) companies. Informed of Current Health Insurance Options Available to Company Small Companies (1-49 EEs) Medium Companies (50-499 EEs) Large Companies (500+ EEs) 2 1 12 16 37 7 46 13 50 35 45 36 0% 20% 40% 60% 80% 100% Micro companies (1-9 EEs) are more likely than small non-micro companies (10-49 EEs) to indicate they are not informed about the current health insurance options for the company (36 percent and 14 percent, respectively). Not at all informed Not very informed Somewhat informed Very informed BASE: Total Employers (small n=283, medium n=355, or large n=120) Q1005. Regardless of whether you offer insurance, how informed do you feel about your company s current options for health insurance (i.e., major medical health insurance)? 68

Companies Divided on Offering Health Insurance Directly to Employees Regardless of company size, the majority of companies prefer to provide health insurance directly to their employees and most also indicate their employees would prefer to receive it from the company. Company Preference for Providing Health Insurance to Employees 51 54 57 Receiving health insurance benefits through your company as part of a benefits package 49 46 43 Receiving a bonus or subsidy from your company for the same amount as a health insurance benefits package to purchase their own health insurance independently Small Companies (1-49 EEs) Medium Companies (50-499 EEs) Large Companies (500+ EEs) Company Perception of Employee Preference for Receiving Health Insurance 62 65 66 38 35 34 Small Companies (1-49 EEs) Medium Companies (49-500 EEs) Large Companies (500+ EEs) BASE: Total Employers (small n=283, medium n=355, or large n=120) Q918/Q1145. Thinking about your employees, which of the following methods of obtaining health insurance do you think your company would prefer assuming the costs to them were the same? Q919/Q1145. Thinking about your employees, which of the following methods of obtaining health insurance do you think your employees would prefer assuming the costs to them were the same? 69

Small Companies Indicate Not Feeling Informed about Impact of Health Industry Changes on Benefits Options Small companies (30 percent) are more likely not to feel informed about the health care industry changes that would impact their company s health care benefits options. In fact, they are not at all informed by about a 2 to 1 margin compared to large (17 percent) or medium (12 percent) companies. Informed about Changes in Health Care Industry that Impact Health Care Benefits Options 100% 80% 18 30 28 Very informed 60% 40% 52 57 55 Somewhat informed Not very informed Not at all informed 20% 19 0% 11 10 14 2 2 Small Companies (1-49 EEs) Medium Companies (50-499 EEs) Large Companies (500+ EEs) Micro companies (1-9 EEs) are more likely than small non-micro companies (10-49 EEs) to not feel informed (35 percent and 22 percent, respectively). BASE: Total Employers (smalln, medium n=355, or large n=120) Q1200. In general, how informed do you consider yourself to be on the health care industry changes that impact your company s health care benefits options, including changes to health insurance? 70

More Medium Companies Use Health Insurance Provider or Benefits Advisor for Health Care Industry News Medium companies are more likely than small or large companies to use a health insurance provider (55 percent vs. 42 percent and 42 percent, respectively) or a benefits advisor (49 percent vs. 23 percent and 37 percent, respectively) to keep informed about the health care industry. Sources for Health Care Industry News Health insurance provider Benefits advisor Health care websites (hospital, physician, pharmaceutical, etc.) News programs on television Magazines or newspapers Communications from the government (local, state, and federal) A search engine like Google, Yahoo or Bing A medical website like WebMD, Medscape Foundation or nonprofit websites or materials News programs on the radio Advertising on television Other None of these 4 4 3 9 7 8 8 13 15 14 11 13 14 11 14 11 16 23 24 28 28 28 19 23 26 25 21 19 29 24 20 25 22 Small Companies (1-49 EEs) Medium Companies (50-499 EEs) Large Companies (500+ EEs) 37 42 42 49 55 Small non-micro companies (10-49 EEs) are more likely than micro companies (1-9 EEs) to use a health insurance provider (52 percent vs. 36 percent, respectively) or a benefits advisor (39 percent vs. 14 percent, respectively). BASE: Total Employers (small n=283, medium n=335, or large n=120) Q1205. Which of the following sources do you consult to keep informed about health care industry news? 71

Large Companies Offer More Options for Health Insurance Education or Advice Small (32 percent) companies, particularly micro (38 percent) companies, are unsure about what they provide to employees regarding education and/or advice about health care benefits. Options Offered by Employer Regarding Education or Advice on Health Insurance Micro (1-9 Non-Micro EEs) (10-49 EEs) Online tools and resources Employee benefits advisor 22 46 53 15 36 13 38 47 5 27 Informative emails One-on-one counseling 12 44 45 17 39 41 13 39 42 9 21 18 3 10 7 8 28 28 24 12 Other Not sure 19 4 26 7 2 32 38 22 9 7 Small Companies (1-49 EEs) Medium Companies (50-499 EEs) Large Companies (500+ EEs) Group meetings, workshops, or seminars Printed brochures and flyers sent in the mail Non-micro small companies are able to provide more options than micro companies. BASE: Total Employers (small n=283, medium n=355, or large n=120) Q1100/Q1120. Which of the following options does your company, insurance plan provider, or benefits advisor offer to your employees regarding education and/or advice about health care benefits, saving for health care costs, or planning for health care costs? Small Companies 72

Many Small Companies Never Proactively Engage Their Employees on Health Care Benefit Offerings Small (43 percent) companies are more likely than medium (6 percent) or large (6 percent) companies to never proactively engage their employees in education or advice about the health care benefits offered. Small Companies (1-49 EEs) Medium Companies (50-499 EEs) Large Companies (500+ EEs) Only during initial enrollment period 8 Only during initial enrollment period 10 Only during initial enrollment period 11 Monthly 3 Monthly 10 Monthly 13 A few times a year 8 A few times a year 24 A few times a year 31 Annually 25 Annually 44 Annually 33 Every few years 6 Every few years 3 Every few years 2 Never 43 Never 6 Never 6 Don t know 6 Don t know 3 Don t know 4 Micro companies (60 percent) are more likely than small non-micro companies (14 percent) to never proactively engage employees. BASE: Total Employers (small n=283, medium n=355, or large n=120) Q1105. How often does your company proactively engage employees in education and/or advice about the health care benefits your company offers? 73

Many Small Companies Do Not Provide Information to Employees about Health Insurance Options Medium (88 percent) or large (89 percent) companies are more likely to provide information to their employees to help them make informed decisions about health insurance options. In fact, 49 percent of small companies do not provide their employees with any information. Small Companies What benefits are available Materials from my company on options/choices A comparison of coverage among health insurance plans that are available A comparison of how the cost (premiums, co-pays, etc.) of health insurance may change from what they pay now A comparison of how access to doctors and providers may change from what is available to them now A quality rating of doctors in the network An unbiased resource on their options/choices Other None of the above Information Provided 2 6 8 8 15 15 14 12 11 19 19 25 26 26 26 32 32 29 38 41 45 45 49 55 61 Micro (1-9 EEs) Non- Micro (10-49 EEs) 18 54 6 31 9 27 5 30 4 16 1 14 7 11 3 1 66 21 Small Companies (1-49 EEs) Medium Companies (50-499 EEs) Large Companies (500+ EEs) Small non-micro companies are more likely than micro companies to provide information to their employees. BASE: Total Employers (small n=283, medium n=355, or large n=120) Q1102. What information, if anything, do you provide so that your employees can make informed choices about their health insurance options? 74

Small Companies Are Less Informed about the ACA than Larger Companies Small (39 percent) companies are more likely (by nearly a 2 to 1 margin) than medium (22 percent) or large (25 percent) companies not to be informed about the ACA. Informed about the ACA 100% 80% 17 28 31 60% 40% 20% 0% 44 50 44 24 18 18 15 5 7 Small Companies (1-49 EEs) Medium Companies (50-499 EEs) Large Companies (500+ EEs) Very informed Somewhat informed Not very informed Not at all informed Small non-micro companies (10-49 EEs) are more likely than micro companies (1-9 EEs) to be informed about the ACA (69 percent and 56 percent, respectively). BASE: Total Employers (small n=283, medium n=355, or large n=120) Q1300. How informed are you about the Patient Protection and Affordable Care Act, also known as health care reform or the ACA? 75

More Medium Companies Express Concern about Higher Costs and Lower Quality Due to the ACA Medium companies are most concerned about higher costs (49 percent) and a decrease in quality (34 percent) as a result of the ACA compared to small (38 percent and 25 percent, respectively) and large (34 percent and 24 percent, respectively) companies. Biggest Concerns about the ACA Higher costs for the company to continue subsidizing or completely paying for employee health care benefits Higher administrative burden for the company to satisfy new regulations related to health care benefits The company will have to reduce or even remove health care benefits they are currently providing due to cost The overall quality of health care for the company's employees will decrease and negatively impact productivity The company will have to reduce employee hours or reduce the number of employees to keep health care benefits affordable for the company Employee morale will decrease due to the changes in health care benefits being offered Attracting new employees will be more difficult as our health care benefits won't be as appealing Employee retention will become an issue due to the changes in health care benefits being offered Other The company has no concerns resulting from the ACA 2 1 1 13 15 20 19 19 18 19 21 22 27 25 30 27 Small Companies (1-49 EEs) Medium Companies (50-499 EEs) Large Companies (500+ EEs) 25 24 24 23 27 26 29 34 35 34 36 38 43 49 Micro companies (1-9 EEs) are more likely than small non-micro companies (10-49 EEs) to express they have no concerns resulting from the ACA (46 percent and 19 percent, respectively). BASE: Total Employers (small n=283, medium n=355, or large n=120) Q1310. Below is a list of hypothetical concerns that companies may have about the ACA. Please indicate your company s biggest concerns about the ACA. 76

Many Small Companies Express No Interest in Possible Improvements from the ACA Although almost half of small (47 percent) companies indicate no interest in improvements from the ACA, small non-micro companies are more interested than micro companies in providing health care benefits to all employees affordably (31 percent vs. 18 percent) and lowering costs (34 percent vs. 19 percent). Improvements Most Interested in from the ACA The company can provide health care benefits for all employees at an affordable cost Lower costs for the company to continue subsidizing or completely paying for employee health care benefits The overall quality of health care for the company's employees will improve and positively impact productivity The company can push more of the administrative burden to employees to choose their own health insurance benefits The company can offer additional health care benefits to attract better employees Employee morale will improve due to the changes in health care benefits being offered Other The ACA will provide no improvements the company is interested in 0 2 2 13 15 15 20 21 21 21 23 25 24 26 Small Companies (1-49 EEs) Medium Companies (50-499 EEs) Large Companies (500+ EEs) 24 26 26 27 27 28 31 31 34 Small non-micro companies (10-49 EEs) are more likely than micro companies (1-9 EEs) to be interested in providing health care benefits to all employees at an affordable cost (31 percent and 18 percent, respectively). Small non-micro companies (34 percent) are also more interested than micro companies (19 percent) in lower costs for the company to subsidize or fully pay for employee health care benefits. 47 BASE: Total Employers (small n=283 medium n=355, or large n=120) Q1315. Below is a list of hypothetical improvements resulting from the ACA. Please select the improvements that your company is most interested in. 77

Many Small Companies Have Not Prepared for the ACA Almost half of small (49 percent) companies have not taken any actions to prepare for changes related to the ACA. Preparations for the ACA Researching details of the ACA Consulting with benefits advisors Calculating possible costs of health care benefits options in the future Consulting the company's current health care providers about possible changes in services and costs of current healthcare benefits Meeting internally to discuss or plan for changes Consulting with industry experts Researching possible new health care benefits providers Considering replacing full-time workers with part-time or contract workers Researching reductions in employees or full-time employees Other Not taking any actions at this time 3 2 23 38 37 20 33 15 38 32 15 34 28 12 32 27 11 30 24 12 29 21 14 17 20 10 16 16 12 15 Small Companies (1-49 EEs) Medium Companies (50-499 EEs) Large Companies (500+ EEs) 45 Micro companies (1-9 EEs) are more likely than small non-micro companies (10-49 EEs) to have not taken any action (61 percent and 29 percent, respectively). 49 BASE: Total Employers (small n=283, medium n=355, or large n=120) Q1325. What actions is your company taking in preparation for changes related to the ACA? Please select all that apply. 78

Small Companies Expect No Impact on the Number of Their Employees due to the ACA Small (76 percent) companies are more likely to indicate the number of their employees will stay the same as a result of the ACA, but this is driven mostly by micro companies rather than the small non-micro companies that are more ambivalent about the impact of the ACA on the number of their employees. Impact of the ACA on Number of Employees 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% % 9 Small Companies (1-49 EEs) 76 15 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% % 26 Medium Companies (50-499 EEs) 52 22 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% % Large Companies (500+ EEs) 27 51 22 Increase Stay the same Decrease Small non-micro companies (10-49 EEs) are more likely than micro companies (1-9 EEs) to expect the number of their employees will increase (15 percent and 6 percent, respectively) or decrease (21 percent and 12 percent, respectively). BASE: Total Employers (small n=283, medium n=355, or large n=120) Q1332. Over the next 2 years, do you anticipate your company will increase, decrease, or have no changes in its number of employees as a result of the ACA? 79

Many Small Companies Do Not Expect Changes to Their Health Care Benefits Half of small (56 percent) companies do not expect changes in their company s health care benefits in the next 1-2 years, but this is driven more by the micro (68 percent) companies rather then the small nonmicro (36 percent) companies. Changes to Health Care Benefits in 1-2 Years Change plan options Reduce or eliminate company contribution to cover costs for health insurance Tighten requirements for employees to be eligible for healthcare benefits Reduce or remove healthcare benefits other than health insurance Reduce or eliminate company contribution to cover costs for healthcare benefits other than health insurance Change insurers Add healthcare benefits other than health insurance Add or increase company contribution to cover costs for health insurance Add or increase company contribution to cover costs for healthcare benefits other than health insurance benefits Add health insurance Remove health insurance Loosen requirements for employees to be eligible for healthcare benefits Other None - I don't expect any changes 15 7 17 20 5 14 18 6 10 15 5 12 13 7 16 9 6 9 11 5 18 8 4 10 11 9 5 4 5 9 3 8 6 2 Small Companies (1-49 EEs) Medium Companies (50-499 EEs) Large Companies (500+ EEs) 23 29 31 34 Micro companies (1-9 EEs) are more likely than small non-micro companies (10-49 EEs) to expect no changes in their company s health care benefits in the next 1-2 years (68 percent and 36 percent, respectively). 56 BASE: Total Employers (small n=283 medium n=355, or large n=120) Q1025. What changes, if any, do you expect will be made to your company's health care benefits in the next 1-2 years? 80

Appendix 81

Employers Are More Familiar with Health Benefits Other than Health Insurance than the Gen Pop The majority of Employers (66 percent) are familiar with health benefits other than health insurance while the majority of the Gen Pop (57 percent) are not. Familiarity with Alternative Insurance Products 100% 8 100% 18 80% 60% 43 35 Very familiar Somewhat familiar 80% 60% 66 48 40% 20% 0% 57 36 21 Total Gen Pop Not very familiar Not at all familiar 40% 20% 0% 34 22 12 Total Employers Women (38 percent) are less likely to be familiar with alternative insurance products compared to men (50 percent). BASE: Total Gen Pop (n=2505) Q1035. How familiar are you with alternative or supplemental insurance products? These are insurance plans that people use to pay for health-related costs not covered by traditional health insurance including long-term care insurance, critical illness insurance, cancer insurance, and similar plans. BASE: Total Employers (n=758) Q1035. How familiar are you with alternative or supplemental insurance products? These are insurance plans that people use to pay for health-related costs not covered by traditional health insurance including long-term care insurance, critical illness insurance, cancer insurance, etc. 82

Participation in Workplace Wellness Programs Is Low A little over half (51 percent) of Workers do not currently participate in a wellness program, but preventative screenings (27 percent) and exercise programs (23 percent) are the two most cited programs in which Workers participate. Wellness Program Participation Preventative screenings and vaccinations Exercise programs - either on-site or discounts for local gyms Healthy food options - on-site cafeteria or healthy snack options Completing a health risk appraisal Monitoring of health goals/biometrics - BMI/weight loss, cholesterol levels, blood pressure, etc On-site health clinic - for routine visits at my office Lunchtime lectures/education on healthy behaviors Managed programs for substance abuse or mental health Medication adherence programs Case managers to track disease management 27% 23% 18% 17% 17% 10% 10% 7% 6% 4% Workers at small companies (68 percent) are more likely than those in medium (50 percent) or large (46 percent) companies not to be participating in any of the listed wellness programs. None of the above 51% BASE: Full-time, part-time, or self-employed Workers (n=1704) Q1130. Below are some programs or initiatives that an employer might offer as part of a wellness initiative. Do you participate in any of the following? 83

Employers Who Use Benefits Advisors Are More Likely to Agree with Positive Aspects of Health Care Benefits Employers are fairly split between those who work with an employee benefits advisor and those who don t work with one. Work with Employee Benefits Advisor Companies that work with benefits advisors are more likely to have positive attitudes about the impact of health care benefits on their company compared to those that do not work with benefits advisors. 50 50 Yes Companies who work with benefits advisors (22 percent) are more likely to offer their part-time employees health care benefits than those who do not work with a benefits advisor (6 percent). No % Agree Health care benefits help keep employees healthy, leading to better productivity Implementing health/wellness and disease management programs lead to better control of health care costs Health care benefits help to boost employee morale Health care benefits help keep and retain employees with the company Health care benefits help to attract quality employees to the company Our employees view their health care benefits as a requirement of their compensation package Health care benefits are a more affordable alternative to pay increases or bonuses Use Benefit Advisor Do Not Use Benefits Advisor 89 79 88 78 89 77 90 75 92 73 88 58 58 48 BASE: Total Employers (n=758) Q1340. Does your company currently work with an employee benefits advisor? Q830: How much do you agree or disagree with the following statements? 84

Employers Look to Health Insurance Providers and Benefits Advisors for Health Care Industry Information Employers cite health insurance providers (44 percent) and benefits advisors (33 percent) as the two leading sources they consult to keep informed about health industry news. Sources Used to Keep Informed about Health Care Industry Health insurance provider 44 Benefits advisor 33 Health care websites News programs on television Magazines or newspapers Communications from the government (local, state, and federal) A search engine like Google, Yahoo or Bing 26 24 23 23 22 A medical website like WebMD, Medscape Foundation or nonprofit websites or materials News programs on the radio 14 13 11 Advertising on television Other 4 6 None of the above 12 BASE: Total Employers (n=758) Q1205. Which of the following sources do you consult to keep informed about health care industry news? Please select all that apply. 85

Employers Expect Their Benefits Advisor Relationships to Stay the Same or Become More Consultative Among companies currently working with benefits advisors, most expect the relationship with their benefit advisors to stay the same (47 percent) or become somewhat more consultative (24 percent). Relationship with Employee Benefits Advisor in Next 2 Years 100% 80% 60% 18 24 Much more consultative Somewhat more consultative Stay the same 40% 20% 0% 47 4 4 2 Total Employers Somewhat less consultative Much less consultative Our company plans to discontinue use of a benefits advisor BASE: Employers who work with benefit advisors (n=445) Q1345. Over the next 2 years, how do you anticipate your relationship with your employee benefits advisor to change, if at all? Our employee benefits advisor will become 86

Small Companies Are Less Likely to Offer Health Insurance Coverage than Other Health Care Benefits Health Care Benefits Offered to Employees Health insurance Dental insurance Vision insurance Disability insurance Health savings account Flexible spending account Long-term care insurance Hospital Intensive Care Critical illness insurance 88 92 85 50 75 84 31 63 79 31 60 71 16 36 56 10 37 56 11 33 50 14 23 29 7 23 27 Hospital Confinement Indemnity/Hospital 13 18 Confinement Sickness Indemnity 23 Cancer insurance 7 18 15 Small Companies (1-49 EEs) Medium Companies (50-499 EEs) Large Companies (500+ EEs) BASE: Provides health care benefits (small n=187, medium n=336, or large n=117) Q810/Q1110. Which of the following health care benefits does your company offer to employees? 87

Medium and Large Companies Are More Likely to Offer a Variety Health Plan Types Compared to Small Companies Health Insurance Plan Types Preferred Provider Organization (PPO) Health Maintenance Organization (HMO) Health Savings Account (HSA) High Deductible Health Plan (HDHP) Health Reimbursement Arrangement (HRA) Fee For Service (FFS) Consumer Driven Health Plan (CDHP) Other 2 <1 <1 0 14 18 8 15 13 8 10 12 10 6 33 32 28 26 41 44 49 51 60 59 Small Companies (1-49 EEs) Medium Companies (50-499 EEs) Large Companies (500+ EEs) BASE: Provides health care benefits (small n=187, medium n=336, or large n=117) Q820. Which types of health plans are included in your health insurance coverage? 88

Small Companies Are Less Familiar with Other Health Benefits Small companies (43 percent) are more likely not to be familiar with health benefits other than health insurance compared to large (28 percent) and medium (24 percent) companies. 100% 80% Familiarity with Health Benefits Other than Health Insurance 14 19 26 60% 40% 42 51 52 Very familiar Somewhat familiar Not very familiar Not at all familiar 29 20% 0% 17 19 15 12 4 Small Companies (1-49 EEs) Medium Companies (50-499 EEs) Large Companies (500+ EEs) A majority of micro companies (1-9 EEs) are not familiar (51 percent) compared to fewer (29 percent) small non-micro companies (10-49 EEs) that are not familiar. BASE: Total Employers (small n=283, medium n=355, or large n=120) Q1035. How familiar are you with alternative or supplemental insurance products? These are insurance plans that people use to pay for health-related costs not covered by traditional health insurance including long term care insurance, critical illness insurance, cancer insurance, etc. 89

Transamerica Center for Health Studies, 2013