SHRM/EBRI 2014 Health Benefits Survey

SHRM Survey Findings: SHRM/EBRI 2014
Health Benefits Survey
November 19, 2014

SHRM/EBRI Health Benefits Survey ©SHRM 2014 2
Key Findings
• Very few organizations expect to eliminate health care coverage in 2015. Only 1% of
organizations reported expecting to eliminate health care coverage in 2015. No government
agencies reported expecting to eliminate coverage.
• Large organizations are more likely to expect to make changes to their health plans in 2015
than small organizations. Large organizations (750 or more FTEs) were more likely to report that
they expect to make changes to their health plans in a variety of ways. In addition, small
organizations (fewer than 750 FTEs) were not significantly more likely to report they expect to make
any changes than larger organizations.
• Large organizations expect to hit the excise tax in 2018. Large organizations are more likely than
small organizations to expect to hit the excise tax in 2018. This could account for significantly more
larger organizations expecting to make changes to their health plans in 2015 to avoid the excise tax.
• PPO plans are the most common plan that is expected to hit the excise tax in 2018. Nearly
75% of organizations expect their PPO plans to hit the excise tax, more than all other plans
combined.
• Organizations do not know what they are going to do to avoid the excise tax. Nearly 30% of
organizations do not know what they will do to avoid the excise tax in 2018.

What Do These Findings Mean for the HR
Profession?
• Despite employers’ continued uncertainty surrounding health care reform and its related costs, most
organizations are not considering eliminating coverage for their employees at this time. Only 1% of
HR professionals who responded to this survey said their organization would eliminate coverage in
2015.
• Other research has shown that health care benefits are an extremely valuable recruiting tool, and
HR professionals often cite these benefits when hiring new workers or retaining existing employees.
Given the competitive nature of finding top talent at the moment, health care benefits should be
viewed as an important element of staffing management.
• Many HR professionals are already looking ahead to 2018, when an employer tax on high-cost
health plans will go into effect. This excise tax of 40% will apply to certain individual and family
thresholds on health plans and will prompt HR professionals to re-examine their health care
offerings as a means of cutting costs. Although many of the respondents to this survey (30%) said
they still don’t know what actions they would take to avoid the excise tax, very few (3.5%) said they
would eliminate health care coverage as a result.

Do You Plan to Make Any of the Following
Changes to Your Health Care Plans in 2015?
Add wellness rewards or penalties
Require spouses to get coverage through own
employer
Institute spousal surcharge
Create tiered networks
Move to private exchange
Adopt a value-based insurance design
Provide an employee subsidy for coverage on the
Eliminate coverage for part-time workers
Note: n = 2,295
3.6%
2.6%
2.6%
1.3%
1.0%
0.6%
3.2%
7.9%
6.7%
26.3%
Eliminate coverage
Adopt reference pricing
0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0%
private exchange

Do You Plan to Make Any of the Following Changes to
Your Health Care Plans in 2015? (by staff size)
Note: n = 2,271
5.9%
5.5%
3.2%
3.6%
3.2%
9.4%
7.9%
6.7%
26.3%
3.1%
7.7%
24.1%
3.8%
10.1%
34.6%
0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% 35.0% 40.0%
employer
750 or more FTEs Fewer than 750 FTEs Total

Your Health Care Plans in 2015? (by staff size,
continued)
2.6%
2.4%
Note: n = 2,135
1.0%
1.0%
1.0%
0.6%
1.3%
2.6%
0.5%
1.1%
2.7%
1.7%
1.4%
2.4%
5.8%
Eliminate coverage
0.0% 1.0% 2.0% 3.0% 4.0% 5.0% 6.0% 7.0%
private exchange

Do You Plan to Make Any of The Following
Changes to Your Health Care Plans in 2015? (by
staff size)
Comparisons by organization staff size
• Organizations with 750 or more FTEs are more likely than organizations with fewer than 750 FTEs to make the
following changes to health care plans in 2015:
• Institute spousal surcharge.
• Eliminate coverage for part-time workers.
• Adopt a value-based insurance design (VBID).
• Adopt reference pricing.
• Create tiered networks.
• Add wellness rewards or penalties.
750 or more FTEs > Fewer than 750 FTEs
Note: Only statistically significant differences are shown.

U.S. Census Bureau Regions

Do You Plan to Make Any of the Following Changes
to Your Health Care Plans in 2015? (by region)
Note: n = 2,264
3.3%
4.0%
2.4%
3.7%
5.1%
3.6%
3.2%
8.0%
7.8%
7.9%
6.7%
26.3%
3.9%
7.3%
28.7%
4.2%
6.8%
27.9%
2.6%
8.1%
10.9%
25.9%
1.6%
4.4%
20.7%
0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% 35.0%
employer
West Midwest South Northeast Total

Your Health Care Plans in 2015? (by region,
continued)
2.6%
2.6%
Note: n = 2,279
1.2%
0.9%
0.7%
1.0%
1.0%
0.6%
1.5%
1.3%
2.6%
0.5%
1.0%
5.1%
3.6%
0.7%
1.8%
3.0%
0.5%
1.6%
2.8%
0.7%
0.2%
2.1%
1.2%
Eliminate coverage
0.0% 1.0% 2.0% 3.0% 4.0% 5.0% 6.0%
private exchange

(by region)
Comparisons by region
South
Midwest
> West
• Organizations in the South and Midwest are more likely than organizations in the West to require spouses to get
health care coverage through their own employer.
• Organizations in the Northeast are more likely than organizations in the South and West to provide an employee
subsidy for coverage on the private exchange.
Northeast >
South
West

(by region)
• Organizations in the South are more likely than organizations in the West to add wellness rewards or penalties.
South > West

Your Health Care Plans in 2015? (by sector)
Note: n = 2,279
3.8%
4.4%
3.5%
2.5%
3.6%
3.2%
8.9%
8.2%
6.3%
7.9%
6.7%
26.3%
2.8%
6.9%
27.0%
3.7%
6.4%
25.3%
2.7%
6.7%
27.5%
1.6%
7.7%
4.9%
27.3%
0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0%
employer
Government Nonprofit Privately owned for-profit Publicly owned for-profit Total

Do You Plan to Make Any of The Following Changes to
Your Health Care Plans in 2015? (by sector, continued)
1.2%
1.3%
2.5%
2.6%
Note: n = 2,279
0.6%
0.9%
0.9%
1.0%
2.6%
0.6%
1.3%
3.8%
0.6%
1.2%
3.1%
2.4%
0.4%
1.1%
1.4%
2.5%
1.6%
0.0%
0.5%
1.6%
2.7%
Eliminate coverage
0.0% 0.5% 1.0% 1.5% 2.0% 2.5% 3.0% 3.5% 4.0%
private exchange

Do You Plan to Make Any of The Following Changes to
Your Health Care Plans in 2015? (by business activity)
Note: n = 2,264
6.1%
4.0%
2.8%
3.2%
3.6%
3.2%
9.0%
6.9%
7.9%
6.7%
26.3%
2.7%
5.9%
19.7%
2.8%
8.7%
29.2%
3.3%
7.6%
26.1%
0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% 35.0%
employer
Services Manufacturing Consulting Total

Your Health Care Plans in 2015? (by business activity,
continued)
1.0%
1.3%
2.5%
2.6%
Note: n = 2,264
1.0%
0.6%
1.0%
2.6%
0.5%
2.1%
1.6%
4.3%
2.1%
1.0%
2.6%
0.4%
0.8%
1.4%
2.3%
2.8%
Eliminate coverage
0.0% 0.5% 1.0% 1.5% 2.0% 2.5% 3.0% 3.5% 4.0% 4.5%
private exchange

Your Health Care Plans in 2015? (by business activity)
• Manufacturing organizations are more likely than consulting organizations to add wellness rewards or penalties.
Comparison by business activity
Comparison by business activity
Manufacturing > Consulting

Do You Expect Your Organization to Hit the Excise
Tax in 2018?
Note: n = 1,803
85%
15%
No Yes

Do You Expect Your Organization to Hit the
Excise Tax in 2018? (by staff size)
750 or more FTEs
Fewer than 750 FTEs
Note: n = 1,713
23.9%
13.2%
15.0%
76.1%
86.8%
85.0%
Total
0.0% 20.0% 40.0% 60.0% 80.0% 100.0% 120.0%
Yes No

Tax in 2018? (by staff size)
Comparison by organization staff size
• Organizations with 750 or more FTEs are more likely than organizations with fewer than 750 FTEs to expect to hit
Comparison by organization staff size
the excise tax in 2018.
750 or more FTEs > Fewer than 750 FTEs

Tax in 2018? (by region)
West
Midwest
South
Northeast
Total
Note: n = 1,791
14.5%
13.7%
13.9%
18.8%
15.0%
85.5%
86.3%
86.1%
81.2%
85.0%
0.0% 20.0% 40.0% 60.0% 80.0% 100.0% 120.0%
Yes No

Tax in 2018? (by sector)
72.5%
Government
Nonprofit
Privately owned for-profit
Publicly owned for-profit
Note: n = 1,791
27.5%
13.1%
12.9%
18.7%
15.0%
86.9%
87.1%
81.3%
85.0%
Total
0.0% 20.0% 40.0% 60.0% 80.0% 100.0% 120.0%
Yes No

Tax in 2018? (by sector)
Comparison by sector
Government >
Nonprofit
• Government agencies are more likely than privately owned for-profit or nonprofit organizations to expect to hit the
excise tax in 2018.

Do You Expect Your Organization to Hit the
Excise Tax in 2018? (by business activity)
Services
Manufacturing
Consulting
Total
Note: n = 1,776
15.7%
14.2%
10.4%
15.0%
84.3%
85.8%
89.6%
85.0%
0.0% 20.0% 40.0% 60.0% 80.0% 100.0% 120.0%
Yes No

Which Plan(s) Do You Expect to Hit the Excise
Tax?
Preferred provider organization (PPO)
Health maintenance organization (HMO)
Point of service (POS)
Consumer-driven health plan
Exclusive provider organization (EPO)
Note: n = 249
4.8%
1.2%
1.6%
7.6%
18.5%
17.3%
74.3%
Indemnity (fee for service)
Other
0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% 70.0% 80.0%

Tax? (by staff size)
Note: n = 239
7.1%
7.7%
7.6%
7.1%
3.6%
4.8%
1.4%
1.2%
1.2%
1.6%
17.1%
19.5%
18.5%
17.3%
74.3%
1.8%
19.5%
72.2%
1.4%
11.4%
80.0%
Other
0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% 70.0% 80.0% 90.0%

Tax? (by region)
Note: n = 246
0.0%
4.7%
2.3%
11.1%
11.1%
9.5%
4.8%
0.0%
0.0%
2.3%
1.9%
1.2%
1.6%
7.6%
15.1%
18.5%
17.4%
17.3%
74.3%
5.6%
11.1%
3.7%
31.5%
18.5%
63.0%
1.2%
11.6%
73.3%
0.0%
3.2%
81.0%
0.0%
9.3%
34.9%
83.7%
Other
0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% 70.0% 80.0% 90.0%

Tax? (by region)
West >
South
Midwest
• Organizations in the West are more likely than organizations in the South or Midwest to expect HMO plans to hit the
excise tax.
• Organizations in the Northeast are more likely than organizations in the Midwest and West to expect POS plans to
hit the excise tax.
Northeast >
Midwest
West

Tax? (by sector)
Note: n = 246
5.1%
3.6%
2.8%
4.8%
0.9%
2.8%
1.2%
1.6%
7.6%
21.4%
18.5%
17.3%
74.3%
2.8%
13.9%
15.7%
8.3%
5.6%
80.6%
0.9%
7.8%
7.0%
18.3%
75.7%
1.8%
5.4%
23.2%
67.9%
5.1%
15.4%
35.9%
74.4%
Other
0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% 70.0% 80.0% 90.0%

Tax? (by sector)
Government >
• Government agencies are more likely than privately owned for-profit or publicly owned for-profit organizations to
expect HMO plans to hit the excise tax.

Tax? (by business activity)
Note: n = 244
5%
4.8%
1%
1.2%
1.6%
7.6%
21%
18.5%
17.3%
74.3%
13%
20%
67%
2%
7%
12%
15%
18%
73%
2%
5%
18%
75%
Other
0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% 70.0% 80.0%

What Actions, if Any, Will You Take to Avoid the
Excise Tax?
35.0%
30.0%
25.0%
20.0%
15.0%
10.0%
5.0%
Note: n = 170
29.4%
16.5%
10.6%
9.4%
4.7% 4.7%
3.5% 3.5%
2.4%
15.3%
0.0%

Demographics

Demographics: Organization Industry
35
Percentage
Services—professional, scientific, technical 20%
Health care, social assistance 17%
Manufacturing (durable goods) 14%
High-tech 13%
Consulting 12%
Business support services 11%
Finance 10%
Manufacturing (nondurable goods) 9%
Retail/wholesale trade 8%
Government/public administration—state/local 8%
Educational services 7%
Publishing, broadcasting, other media 6%
Religious, grant-making, civic, professional and similar organizations 6%
Transportation, warehousing 6%
Note: n = 3,329. Total number of respondents and percentage for this question exceeded the overall sample size due to multiple response options.
SHRM/EBRI Health Benefits Survey ©SHRM 2014

Demographics: Organization Industry (continued)
36
Percentage
Construction, mining, oil and gas 4%
Insurance 4%
Services—accommodation, food and drinking places 4%
Arts, entertainment, recreation 3%
Utilities 3%
Telecommunications 3%
Real estate, rental, leasing 3%
Repair and maintenance 3%
Association—professional/trade 1%
Biotech 1%
Pharmaceutical 1%
Waste management and remediation services 1%
Government/public administration—federal 1%
Note: n = 3,329. Total number of respondents and percentage for this question exceeded the overall sample size due to multiple response options.

Demographics: Organization Sector
Note: n = 3,302. Percentages do not equal 100% due to rounding.
53%
23%
16%
9%
Privately owned for profit
Nonprofit
Government

Demographics: Organization Staff Size
Note: n = 3,031. Percentages do not equal 100% due to rounding.
37%
38%
17%
8%
1%
1 to 99 employees
100 to 499 employees
500 to 2,499 employees
2,500 to 24,999
25,000 or more employees

Demographics: Region
Note: n = 3,289.
38%
26%
18%
18%
South
Midwest
West
Northeast

Demographics: Business Activity
Note: n = 3,277.
65%
26%
9%
Services
Manufacturing
Consulting

Demographics: Organizational Level
Note: n = 3,190.
24%, Business
unit/work location
76%, Corporate
(companywide)

42
Survey Methodology
• Response rate = 14%
• 3,329 HR professionals from a randomly selected sample of SHRM’s membership
• Margin of error +/- 5%
• Survey fielded February 4 to April 7, 2014

For more survey/poll findings, visit shrm.org/surveys
For more information about SHRM’s Customized Research Services,
visit shrm.org/customizedresearch
Follow us on Twitter @SHRM_Research
43
About SHRM Research
Project leader:
Andrew Mariotti, senior researcher, SHRM Research
Project contributors:
Steven Hyde, research coordinator, SHRM Research
Joseph Coombs, senior analyst, SHRM Research
Copy editor:
Katya Scanlan, SHRM Knowledge Center

SHRM
Founded in 1948, the Society for Human Resource Management (SHRM) is the world’s
largest HR membership organization devoted to human resource management.
Representing more than 275,000 members in over 160 countries, the Society is the leading
provider of resources to serve the needs of HR professionals and advance the professional
practice of human resource management. SHRM has more than 575 affiliated chapters
within the United States and subsidiary offices in China, India and United Arab Emirates. Visit
us at shrm.org.
EBRI
The Employee Benefit Research Institute is a private, nonpartisan, nonprofit research
institute based in Washington, DC, that focuses on health, savings, retirement, and economic
security issues. EBRI does not lobby and does not take policy positions. The work of EBRI is
made possible by funding from its members and sponsors, which include a broad range of
public, private, for-profit and nonprofit organizations. For more information go to www.ebri.org
or www.asec.org
About SHRM and EBRI

SHRM/EBRI 2014 Health Benefits Survey

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