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SHRM Poll: Organizations’ Response to Health
Care Reform—Senior Management’s Requests


                                 September 17, 2010
Health Care Reform Series: Poll 2
                        Introduction

Landmark legislation that brought about major reforms in health care coverage in the
United States was enacted in March 2010. The law affects employers and HR
professionals in a variety of ways. SHRM will be conducting a series of polls on health
care reform and its implications for employers and employees. This presentation covers
the findings from the second poll in this series, which was conducted in July 2010.




                             Organizations’ Response to Health Care Reform – Senior Management’s Requests | ©SHRM 2010   2
Key Findings



•   Has senior management asked HR to provide an overview of the implications of the new law? Larger
    organizations (those with 500 to 24,999 employees) were more likely than organizations with fewer than
    500 employees to report that senior management asked HR to provide an overview of the implications of
    the new health care reform law for their organization.
•   Are leaders of organizations focusing on the short-term or long-term implications of the new law? HR
    professionals appear to be focused first on addressing short-term implications of the law with organizational
    leadership, before addressing long-term and more strategic issues.
•   What areas are HR professionals addressing with their organizational leadership in relation to the new
    law? HR professionals report that they addressing overall knowledge of the new law, actions the
    organization needs to take immediately, changes the organization needs to make to its current health care
    plan to be compliant and the immediate financial implications (for 2010 and 2011).




                                     Organizations’ Response to Health Care Reform – Senior Management’s Requests | ©SHRM 2010   3
In your organization, has senior management asked HR to provide an
  overview of the implications of the new health care reform law for your
  organization?




                       No, 46%

                                                                                                                                Yes, 54%




Note: n = 695. “Not sure” responses were excluded from this analysis.

                                                        Organizations’ Response to Health Care Reform – Senior Management’s Requests | ©SHRM 2010   4
In your organization, has senior management asked HR to provide an
overview of the implications of the new health care reform law for your
organization?

    Comparison by Organization’s Staff Size, Sector, Operations Location and Medical Benefit Funding
•      By staff size: Larger organizations (those with 500 to 24,999 employees) were more likely than organizations with fewer than 500
       employees to report that senior management asked HR to provide an overview of the implications of the new health care reform law for their
       organization.


                     Smaller Organizations                Larger Organizations                Differences Based on
                                                                                              Organization Staff Size
                 •100 to 499 employees (43%)         •500 to 2,499 employees (63%)        Larger organizations > smaller
                                                     •2,500 to 24,999 employees           organizations
                                                     (74%)

•      By sector: Publicly owned for-profits (68%) were more likely than privately owned for-profits (51%) and nonprofits (51%) to report that
       senior management asked HR to provide an overview of the implications of the new health care reform law for their organization.

•      By operations location: Organizations with multinational operations (62%) were more likely than U.S.-based only organizations (51%) to
       report that senior management asked HR to provide an overview of the implications of the new health care reform law for their organization.

•      By medical benefit funding: Organizations with self-insured medical benefit (64%) were more likely than insured organizations (41%) to
       report that senior management asked HR to provide an overview of the implications of the new health care reform law for their organization.




                                                  Organizations’ Response to Health Care Reform – Senior Management’s Requests | ©SHRM 2010          5
Which of the following issues has your HR team addressed or is it continuing to
  address in order to help the leadership of your organization better understand
  the new health care reform law and its implications?



 Overall knowledge of the new health care reform law                                                                                                51%
 Actions your organization needs to take immediately                                                                                                49%
 Changes your organization needs to make to its current health care plan to be compliant                                                            47%

 The immediate financial implications (2010 and 2011)                                                                                               46%

 The future financial implications (beyond 2011)                                                                                                    39%

 Affordability of your health care plan for current employees                                                                                       31%

 Health care as part of the total compensation package                                                                                              24%

 Resources available to help the organization analyze, design and communicate health care plan to stakeholders                                      20%
 Possible penalties your organization could incur if it doesn’t comply with new health care reform law, decides not to offer
                                                                                                                                                    16%
 health care to employees or makes changes to the plan
 Deciding who is the best resource (e.g., counsel/consultant) to explain the new health care reform law                                             13%

 Investigating the impact of the new health care reform law on part-time employees in the organization                                              9%

 Determining the impact on recruitment and retention strategies                                                                                     7%

 Developing a plan on how to figure out each employee’s household income                                                                            3%

 Other                                                                                                                                              3%

  • HR professionals appear to be focused first on addressing short-term implications of the law with
  organizational leadership, before addressing long-term and more strategic issues.
Note: n = 814. Percentages do not total 100% as multiple response was allowed.
Respondents were allowed to select up to three options.
                                                        Organizations’ Response to Health Care Reform – Senior Management’s Requests | ©SHRM 2010         6
Which of the following issues has your HR team addressed or is it continuing to
address in order to help the leadership of your organization better understand
the new health care reform law and its implications?

    Comparison by Organization’s Staff Size, Union Status and Medical Benefit Funding
•      The immediate financial implications (2010 and 2011) (by staff size): Larger organizations (those with 500 to 24,999 employees) were
       more likely than organizations with fewer than 500 employees to report that the issue they have addressed or are continuing to address to
       help their leadership better understand the health care reform law is the immediate financial implications (2010 and 2011).
                     Smaller Organizations                 Larger Organizations                Differences Based on
                                                                                               Organization Staff Size
                 •100 to 499 employees (35%)          •500 to 2,499 employees (54%)        Larger organizations > smaller
                                                      •2,500 to 24,999 employees           organizations
                                                      (59%)


•      The immediate financial implications (2010 and 2011) (by medical benefit funding): Self-insured organizations (55%) were more likely
       than insured organizations (38%) to report that the issue they have addressed or are continuing to address to help their leadership better
       understand the health care reform law is the immediate financial implications (2010 and 2011).

•      The future financial implications (beyond 2011) (by medical benefit funding): Self-insured organizations (45%) were more likely than
       insured organizations (32%) to report that the issue they have addressed or are continuing to address to help their leadership better
       understand the health care reform law is the future financial implications (beyond 2011).

•      Changes your organization needs to make to its current health care plan to be compliant (by medical benefit funding): Self-insured
       organizations (57%) were more likely than insured organizations (36%) to report that the issue they have addressed or are continuing to
       address to help their leadership better understand the health care reform law is changes their organization needs to make to its current
       health care plan to be compliant .

•      Health care as part of the total compensation package (by union status): Organizations with no employees under a collective
       bargaining agreement (33%) were more likely than unionized organizations (23%) to report that the issue they have addressed or are
       continuing to address to help their leadership better understand the health care reform law is health care as part of the total compensation
       package.



                                                  Organizations’ Response to Health Care Reform – Senior Management’s Requests | ©SHRM 2010           7
How is your organization’s primary medical benefit currently funded?




           Insured, 44%


                                                                                                   Self-insured, 56%




Note: n = 749               Organizations’ Response to Health Care Reform – Senior Management’s Requests | ©SHRM 2010   8
How is your organization’s primary medical benefit currently funded?


    Comparison by Organization’s Staff Size, Sector, Operations Location, Sector and Union Status
•      By staff size: Larger organizations (those with 500 or more employees) were more likely than organizations with fewer than 500 employees
       to report that their organization’s primary medical benefit is self-insured.


                    Smaller Organizations                Larger Organizations                 Differences Based on
                                                                                              Organization Staff Size
               •100 to 499 employees (39%)          •500 to 2,499 employees (69%)        Larger organizations > smaller
                                                    •2,500 to 24,999 employees           organizations
                                                    (84%)
                                                    •25,000 or more employees
                                                    (84%)




•      By operations location: Organizations with multinational operations (71%) were more likely than U.S.-based (51%) organizations to report
       that their organization’s primary medical benefit is self-insured.



•      By sector: Publicly owned for-profits (72%) were more likely than privately owned for-profits (50%) and nonprofits (49%) to report that their
       organization’s primary medical benefit is self-insured.



•      By union status: Unionized organizations (64%) were more likely than non-unionized (54%) organizations to report that their organization’s
       primary medical benefit is self-insured.




                                                  Organizations’ Response to Health Care Reform – Senior Management’s Requests | ©SHRM 2010            9
Demographics: Organization Industry


   Industry
  Manufacturing –other                                                                                              18%

  Health care, social assistance (e.g., hospitals, clinics)                                                         13%

  Financial services (e.g., banking)                                                                                 8%

  Services –professional, scientific, technical, legal                                                               7%

  Educational services/education                                                                                     6%

  Government/public administration—federal, state/local, tribal                                                      5%
                                                                                                                     5%
  Retail/wholesale trade

  Construction, mining, oil and gas                                                                                  4%

                                                                                                                     4%
  Insurance




  Note: n = 754. Percentages do not total 100% due to rounding.


                                               Organizations’ Response to Health Care Reform – Senior Management’s Requests | ©SHRM 2010   10
Demographics: Organization Industry (continued)


    Industry
   Other services (e.g., other nonprofit, church/religious organizations)                                             4%
   Transportation, warehousing (e.g., distribution)                                                                   3%
   High-tech                                                                                                          3%
   Services—accommodation, food and drinking places                                                                   3%
   Utilities                                                                                                          2%
   Real estate, rental, leasing                                                                                       2%
   Publishing, broadcasting, other media                                                                              2%
   Manufacturing—auto/auto-related                                                                                    2%
   Arts, entertainment, recreation                                                                                    1%
   Consulting                                                                                                         1%
   Telecommunications                                                                                                 1%
   Association—professional/trade                                                                                     0%
   Pharmaceutical                                                                                                     0%
   Biotech                                                                                                            0%
   Other                                                                                                              5%




   Note: n = 754. Percentages do not total 100% due to rounding.


                                               Organizations’ Response to Health Care Reform – Senior Management’s Requests | ©SHRM 2010   11
Demographics: Organization Sector



                Privately owned for-profit organization                                                             47%




                Publicly owned for-profit organization                                21%




                                Nonprofit organization                              20%




                                   Government sector                   8%




                                                   Other          4%



                                                           0%        10%        20%         30%        40%         50%          60%



Note: n = 756                       Organizations’ Response to Health Care Reform – Senior Management’s Requests | ©SHRM 2010     12
Demographics: Organization Staff Size


50%


40%
                                                                            35%

30%                                              27%                                                   26%


20%


10%
                    6%                                                                                                             5%

 0%
          50 to 99 employees           100 to 499 employees 500 to 2499 employees                 2500 to 24999              25000 or more
                                                                                                   employees                  employees




      Note: n = 497. Percentages do not total 100% due to rounding.

                                                   Organizations’ Response to Health Care Reform – Senior Management’s Requests | ©SHRM 2010   13
Demographics: Other


  Does the organization have U.S.-based                  Is organization a single-unit company or a multi-
  operations (business units) only or                    unit company?
  does it operate multinationally?
                                                                     Single-unit company: A               29%
                                                                     company in which the
   U.S.-based operations      75%                                    location and the company
                                                                     are one and the same
   Multinational operations   25%                                    Multi-unit company: A                71%
                                                                     company that has more than
   Note: n = 750                                                     one location

                                                                     Note: n = 763

• 19% of organizations indicated that                   Are HR policies and practices determined by
employees at their work location were                   the multi-unit corporate headquarters, by each
unionized.                                              work location or both?
  Note: n = 755
                                                                     Multi-unit headquarters determines             64%
                                                                     HR policies and practices

                                                                     Each work location determines HR               1%
                                                                     policies and practices

                                                                     A combination of both the work                 35%
                                                                     location and the multi-unit
                                                                     headquarters determine HR policies
                                                                     and practices


                                                                     Note: n = 556
                                        Organizations’ Response to Health Care Reform – Senior Management’s Requests | ©SHRM 2010   14
SHRM Poll: Organizations’ Response to Health Care Reform – Poll 2


 Methodology

              •   Response rate = 21%
              •   Sample comprised of 1,095 randomly selected HR
                  professionals with the job title of manager and above, as
                  well as HR professionals in the compensation and
                  benefits functional area. All analyses were based on
                  respondents working at organizations with a staff size of
                  50 employees or more.
              •   Margin of error is +/- 3%
              •   Survey fielded July 22–August 3, 2010


                  For more poll findings, visit:
                  www.shrm.org/surveys
                  Follow us on Twitter:
                  http://twitter.com/SHRM_Research


                           Organizations’ Response to Health Care Reform – Senior Management’s Requests | ©SHRM 2010   15

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Shrm poll health_care2_seniormanagement

  • 1. SHRM Poll: Organizations’ Response to Health Care Reform—Senior Management’s Requests September 17, 2010
  • 2. Health Care Reform Series: Poll 2 Introduction Landmark legislation that brought about major reforms in health care coverage in the United States was enacted in March 2010. The law affects employers and HR professionals in a variety of ways. SHRM will be conducting a series of polls on health care reform and its implications for employers and employees. This presentation covers the findings from the second poll in this series, which was conducted in July 2010. Organizations’ Response to Health Care Reform – Senior Management’s Requests | ©SHRM 2010 2
  • 3. Key Findings • Has senior management asked HR to provide an overview of the implications of the new law? Larger organizations (those with 500 to 24,999 employees) were more likely than organizations with fewer than 500 employees to report that senior management asked HR to provide an overview of the implications of the new health care reform law for their organization. • Are leaders of organizations focusing on the short-term or long-term implications of the new law? HR professionals appear to be focused first on addressing short-term implications of the law with organizational leadership, before addressing long-term and more strategic issues. • What areas are HR professionals addressing with their organizational leadership in relation to the new law? HR professionals report that they addressing overall knowledge of the new law, actions the organization needs to take immediately, changes the organization needs to make to its current health care plan to be compliant and the immediate financial implications (for 2010 and 2011). Organizations’ Response to Health Care Reform – Senior Management’s Requests | ©SHRM 2010 3
  • 4. In your organization, has senior management asked HR to provide an overview of the implications of the new health care reform law for your organization? No, 46% Yes, 54% Note: n = 695. “Not sure” responses were excluded from this analysis. Organizations’ Response to Health Care Reform – Senior Management’s Requests | ©SHRM 2010 4
  • 5. In your organization, has senior management asked HR to provide an overview of the implications of the new health care reform law for your organization? Comparison by Organization’s Staff Size, Sector, Operations Location and Medical Benefit Funding • By staff size: Larger organizations (those with 500 to 24,999 employees) were more likely than organizations with fewer than 500 employees to report that senior management asked HR to provide an overview of the implications of the new health care reform law for their organization. Smaller Organizations Larger Organizations Differences Based on Organization Staff Size •100 to 499 employees (43%) •500 to 2,499 employees (63%) Larger organizations > smaller •2,500 to 24,999 employees organizations (74%) • By sector: Publicly owned for-profits (68%) were more likely than privately owned for-profits (51%) and nonprofits (51%) to report that senior management asked HR to provide an overview of the implications of the new health care reform law for their organization. • By operations location: Organizations with multinational operations (62%) were more likely than U.S.-based only organizations (51%) to report that senior management asked HR to provide an overview of the implications of the new health care reform law for their organization. • By medical benefit funding: Organizations with self-insured medical benefit (64%) were more likely than insured organizations (41%) to report that senior management asked HR to provide an overview of the implications of the new health care reform law for their organization. Organizations’ Response to Health Care Reform – Senior Management’s Requests | ©SHRM 2010 5
  • 6. Which of the following issues has your HR team addressed or is it continuing to address in order to help the leadership of your organization better understand the new health care reform law and its implications? Overall knowledge of the new health care reform law 51% Actions your organization needs to take immediately 49% Changes your organization needs to make to its current health care plan to be compliant 47% The immediate financial implications (2010 and 2011) 46% The future financial implications (beyond 2011) 39% Affordability of your health care plan for current employees 31% Health care as part of the total compensation package 24% Resources available to help the organization analyze, design and communicate health care plan to stakeholders 20% Possible penalties your organization could incur if it doesn’t comply with new health care reform law, decides not to offer 16% health care to employees or makes changes to the plan Deciding who is the best resource (e.g., counsel/consultant) to explain the new health care reform law 13% Investigating the impact of the new health care reform law on part-time employees in the organization 9% Determining the impact on recruitment and retention strategies 7% Developing a plan on how to figure out each employee’s household income 3% Other 3% • HR professionals appear to be focused first on addressing short-term implications of the law with organizational leadership, before addressing long-term and more strategic issues. Note: n = 814. Percentages do not total 100% as multiple response was allowed. Respondents were allowed to select up to three options. Organizations’ Response to Health Care Reform – Senior Management’s Requests | ©SHRM 2010 6
  • 7. Which of the following issues has your HR team addressed or is it continuing to address in order to help the leadership of your organization better understand the new health care reform law and its implications? Comparison by Organization’s Staff Size, Union Status and Medical Benefit Funding • The immediate financial implications (2010 and 2011) (by staff size): Larger organizations (those with 500 to 24,999 employees) were more likely than organizations with fewer than 500 employees to report that the issue they have addressed or are continuing to address to help their leadership better understand the health care reform law is the immediate financial implications (2010 and 2011). Smaller Organizations Larger Organizations Differences Based on Organization Staff Size •100 to 499 employees (35%) •500 to 2,499 employees (54%) Larger organizations > smaller •2,500 to 24,999 employees organizations (59%) • The immediate financial implications (2010 and 2011) (by medical benefit funding): Self-insured organizations (55%) were more likely than insured organizations (38%) to report that the issue they have addressed or are continuing to address to help their leadership better understand the health care reform law is the immediate financial implications (2010 and 2011). • The future financial implications (beyond 2011) (by medical benefit funding): Self-insured organizations (45%) were more likely than insured organizations (32%) to report that the issue they have addressed or are continuing to address to help their leadership better understand the health care reform law is the future financial implications (beyond 2011). • Changes your organization needs to make to its current health care plan to be compliant (by medical benefit funding): Self-insured organizations (57%) were more likely than insured organizations (36%) to report that the issue they have addressed or are continuing to address to help their leadership better understand the health care reform law is changes their organization needs to make to its current health care plan to be compliant . • Health care as part of the total compensation package (by union status): Organizations with no employees under a collective bargaining agreement (33%) were more likely than unionized organizations (23%) to report that the issue they have addressed or are continuing to address to help their leadership better understand the health care reform law is health care as part of the total compensation package. Organizations’ Response to Health Care Reform – Senior Management’s Requests | ©SHRM 2010 7
  • 8. How is your organization’s primary medical benefit currently funded? Insured, 44% Self-insured, 56% Note: n = 749 Organizations’ Response to Health Care Reform – Senior Management’s Requests | ©SHRM 2010 8
  • 9. How is your organization’s primary medical benefit currently funded? Comparison by Organization’s Staff Size, Sector, Operations Location, Sector and Union Status • By staff size: Larger organizations (those with 500 or more employees) were more likely than organizations with fewer than 500 employees to report that their organization’s primary medical benefit is self-insured. Smaller Organizations Larger Organizations Differences Based on Organization Staff Size •100 to 499 employees (39%) •500 to 2,499 employees (69%) Larger organizations > smaller •2,500 to 24,999 employees organizations (84%) •25,000 or more employees (84%) • By operations location: Organizations with multinational operations (71%) were more likely than U.S.-based (51%) organizations to report that their organization’s primary medical benefit is self-insured. • By sector: Publicly owned for-profits (72%) were more likely than privately owned for-profits (50%) and nonprofits (49%) to report that their organization’s primary medical benefit is self-insured. • By union status: Unionized organizations (64%) were more likely than non-unionized (54%) organizations to report that their organization’s primary medical benefit is self-insured. Organizations’ Response to Health Care Reform – Senior Management’s Requests | ©SHRM 2010 9
  • 10. Demographics: Organization Industry Industry Manufacturing –other 18% Health care, social assistance (e.g., hospitals, clinics) 13% Financial services (e.g., banking) 8% Services –professional, scientific, technical, legal 7% Educational services/education 6% Government/public administration—federal, state/local, tribal 5% 5% Retail/wholesale trade Construction, mining, oil and gas 4% 4% Insurance Note: n = 754. Percentages do not total 100% due to rounding. Organizations’ Response to Health Care Reform – Senior Management’s Requests | ©SHRM 2010 10
  • 11. Demographics: Organization Industry (continued) Industry Other services (e.g., other nonprofit, church/religious organizations) 4% Transportation, warehousing (e.g., distribution) 3% High-tech 3% Services—accommodation, food and drinking places 3% Utilities 2% Real estate, rental, leasing 2% Publishing, broadcasting, other media 2% Manufacturing—auto/auto-related 2% Arts, entertainment, recreation 1% Consulting 1% Telecommunications 1% Association—professional/trade 0% Pharmaceutical 0% Biotech 0% Other 5% Note: n = 754. Percentages do not total 100% due to rounding. Organizations’ Response to Health Care Reform – Senior Management’s Requests | ©SHRM 2010 11
  • 12. Demographics: Organization Sector Privately owned for-profit organization 47% Publicly owned for-profit organization 21% Nonprofit organization 20% Government sector 8% Other 4% 0% 10% 20% 30% 40% 50% 60% Note: n = 756 Organizations’ Response to Health Care Reform – Senior Management’s Requests | ©SHRM 2010 12
  • 13. Demographics: Organization Staff Size 50% 40% 35% 30% 27% 26% 20% 10% 6% 5% 0% 50 to 99 employees 100 to 499 employees 500 to 2499 employees 2500 to 24999 25000 or more employees employees Note: n = 497. Percentages do not total 100% due to rounding. Organizations’ Response to Health Care Reform – Senior Management’s Requests | ©SHRM 2010 13
  • 14. Demographics: Other Does the organization have U.S.-based Is organization a single-unit company or a multi- operations (business units) only or unit company? does it operate multinationally? Single-unit company: A 29% company in which the U.S.-based operations 75% location and the company are one and the same Multinational operations 25% Multi-unit company: A 71% company that has more than Note: n = 750 one location Note: n = 763 • 19% of organizations indicated that Are HR policies and practices determined by employees at their work location were the multi-unit corporate headquarters, by each unionized. work location or both? Note: n = 755 Multi-unit headquarters determines 64% HR policies and practices Each work location determines HR 1% policies and practices A combination of both the work 35% location and the multi-unit headquarters determine HR policies and practices Note: n = 556 Organizations’ Response to Health Care Reform – Senior Management’s Requests | ©SHRM 2010 14
  • 15. SHRM Poll: Organizations’ Response to Health Care Reform – Poll 2 Methodology • Response rate = 21% • Sample comprised of 1,095 randomly selected HR professionals with the job title of manager and above, as well as HR professionals in the compensation and benefits functional area. All analyses were based on respondents working at organizations with a staff size of 50 employees or more. • Margin of error is +/- 3% • Survey fielded July 22–August 3, 2010 For more poll findings, visit: www.shrm.org/surveys Follow us on Twitter: http://twitter.com/SHRM_Research Organizations’ Response to Health Care Reform – Senior Management’s Requests | ©SHRM 2010 15