While more than half of employers recently surveyed about healthcare reform provisions say they will maintain their health plans,one-third don't know what they will do in 2014 when new stateexchanges start operating.

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The amount of indecision, a need for employers to look for waysto lower group health plan costs, and struggles for small insuranceagencies in tackling compliance questions are all factors that openup opportunities for large insurance brokers like Willis, whichdeveloped the survey.

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Willis' national survey of across-section of more than 1,000 businesses aimed to get a betterunderstanding of employers' plans and expectations as the mandatesof the Patient Protection and Affordable Care Act take effect.Willis, partnering with Diamond Consulting, also asked employerswhat concerns them as the law takes effect.

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The survey, "Health Care Reform 2010 Survey," released Nov. 10by Willis, covered 1,400 businesses comprising more than ninemillion covered employees in companies of various sizes and variedindustry sectors from different regions of the country. Thosesurveyed were asked how they feel about the health care reform act,how they believe it will affect them, and how prepared theyare.

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Fifty-five percent of employers said they would continue tomaintain their health plans in 2014 when state exchanges arescheduled to go into operation, while 33 percent said they do notyet know what they will do.

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A total of 88 percent of respondents believe that group healthplan costs will increase as a result of the PPACA mandates.Seventy-six percent said they believe administrative compliancecosts will increase.

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As a result, 72 percent of respondents said they plan toincrease employee contributions to attempt to offset the impact ofhigher administrative and premium costs.

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Surveyed employers indicated they would consider using one ormore options to maintain plans, including: passing on more costs toemployees; decreasing ancillary benefits, such as dental and visionbenefits; or in some extreme cases, eliminating benefitscompletely.

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Willis also reported:

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o The adult child coverage mandate that becomes effective formost plans on Jan. 1 is expected to increase the cost for healthcare plans by 1 percent, according to 53 percent of thosesurveyed.

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o More than half of the respondents noted a lack of clearunderstanding concerning the availability and eligibility for theWellness Credit and Small Business Tax Credit.

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o Fifty-two percent of survey respondents anticipate an increasein the number of employees covered under employer-sponsoredbenefits.

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The report notes that "a majority of respondents felt thatemployers would generally not accept lowered profits on account ofthe Health Care Reform legislation. This will likely result inemployers looking for ways to offset any resulting costincreases."

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Mike Barton, chairman of Willis North America Human Capitalpractice, said the purpose of the survey is to understandemployers' view of health care reform.

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"The overall feedback we heard from employers is that this iscostly. In their view, this will increase their price tag forhealth care delivery, not decrease the price tag," said Mr. Barton,adding that the finding is not surprising.

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For employers, he said the major concern is not who pays forhealth care, which he said is the primary focus of the legislation,but controlling the increasing costs of health care. "It's acomplete whiff," he said, using a baseball analogy to suggest thatthe legislation misses the mark.

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"The 'what you pay' issue is what employers should be focusingon," Mr. Barton continued, adding that the whole cost issue is nothelped by health care reform but hurt. When the majority of thosepolled believe that their cost will be increased, and reformdoesn't address the cost issue, the real issue for employers is"how do you manage cost. And this hasn't changed for decades inAmerica."

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For Willis, Mr. Barton said thatdealing with this issue is dealing with the demand for health care,and that means addressing the cultural issues that drive healthcare costs.

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There are three things driving that demand–what you eat, how youexercise and unhealthy habits, such as smoking, he noted.

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So what should clients be seeking to do to control thosecosts?

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"Anything they can do to support a behavior change, behaviormodification, with their employees and their family members aroundbetter diet, more exercise and stopping unhealthy health habits,"said Mr. Barton.

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"Everything that we are doing is designed to help employerssupport a culture of health," he continued. "It's message. It'stools and resources."

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Doing its part, the firm has built a website named Winning WithWillis (www.winningwithwills.com), a publicly accessible portal tohelp the public find answers about many health subjects with linksto the Center for Disease Control website.

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The aim of the site, said Mr. Barton, is to speak directly toemployees and family members about health issues and to make iteasier to get that information.

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The firm also utilizes a Health Care Reform Calculator that candetermine the cost of reform tailored to the individual situationof a client. Willis generates a report to help clients determinethe cost of implementing different aspects of the reformprogram.

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For years, employers and employees have thought of healthbenefits as an entitlement they receive for employment, observedMr. Barton. The benefits that companies offer have not changed inthe more than 20 years he has been in the business, he said. Willisis working with its clients to change that mindset to a reward-based system where employees receive a base health care plan, butif they become active participants in their health, they receivegreater benefits.

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"Every employer has drawn a line in the sand and said I can'ttake much more of this," said Mr. Barton. "The idea is to rewardsomeone who is taking an active role in their health care with adifferent style of benefit."

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He admits that while the chief executives love the plan,employees are initially resistant and it can be a rocky program forthe first year. But by the second and third year "they totally getit," he said.

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Another major worry among clients relates to compliance issues,which he said can be confusing and require the help of a broker tokeep everything in place. Willis, he said, is spending a lot oftime and energy answering those compliance questions and advisingclients appropriately.

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While Willis has the resources to invest in doing this duediligence work, smaller agencies can't keep up, he acknowledged.Recognizing this, the human capital practice has partnered withsmaller agencies to lend them support.

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Some of these partnerships could lead to acquisition if it isstrategically in Willis' interest, but many are not, Mr. Bartonnoted. Still, agencies are coming to Willis for help and the firmis opening its resources to them.

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Agencies now find they are in need of some support as a resultof the act, Mr. Barton explained. "The question becomes do youinvest a lot of money and buy all these agencies, or do you make alow capital investment where you partner and support?"

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"We want to get into that space," Mr. Barton said. "We want tohelp. We do have an appetite for it. We believe we can help…through what we are calling a commercial network strategy, where wecan partner with [agencies] and share some of our resources andhelp them get over the hump for some sort of revenue-sharingexchange. That is absolutely on our radar screen."

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The agencies, the Mom-and-Pop-type firms, understand, and theirclients understand, that they are being overwhelmed with the healthcare reform issues. And the relationship Willis has built withthese agencies is saving their businesses, he said.

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"We are not out to steal their business. They see us as thewhite knight that is saving their family business," Mr. Bartonsaid.

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"We are a company that has a conscience. And, we are a companythat has a blue-collar personality," noted Mr. Barton. "We like toroll up our sleeves and come to work," he said.

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