Governments reveal health and OPEB funding strategies.
Position | News & Numbers - Other post-employment benefits |
For many units of government, the economic outlook in 2014 continues to brighten. However, Affordable Care Act (ACA) implementation and ongoing concerns about health-care costs and other post-employment benefits (OPEB) liability remain major areas of concern for any organization that provides benefits to retirees and active employees.
Health and OPEB Funding Strategies: 2014 National Survey of Governments, a recent survey from Cobalt Community Research, checked with 1,536 jurisdictions about questions such as how they expect their revenue and employment levels to change next year, what percentage of the health-care costs they pay for active and retired employees, and how these benefits are insured.
Key findings include the following:
* A third of respondents expect 2015 revenue to increase, up from 13 percent in 2011. Just 17 percent expect a revenue drop, compared with 43 percent in 2011.
* Few governments are expecting increased employment (7 percent), and some expect a decrease (5 percent).
* Health costs increased for 50 percent of respondents by 4 percent increase for 2014, and 56 percent expect an increase of more than 4 percent for 2015.
* Respondents rate the effectiveness of their efforts to control health costs at 5.1 out of 10, the same as 2011.
* ACA knowledge is limited; respondents rate their knowledge at 4.5 out of 10.
* Employers that offer coverage have responded to the ACA by conducting compliance reviews, testing to meet minimum value, and calculating ACA costs. Nearly half are developing strategies for part-time and seasonal employees because of the 30-hour per week requirement.
* Few employers are eliminating coverage or moving toward an exchange, and fewer than 10 percent are considering an exchange in the...
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