Employers Need to Know How the ACA Will Affect Disability Management

DisabilityObamaMost employers haven’t given much thought to how the Affordable Care Act (ACA) will affect disability and absence management, according to study by the Disability Management Employer Coalition (DMEC) and Pacific Resources. But disability and absence management needs to be considered in the context of health care reform, said Pat Purdy, vice president of Core Benefits Solutions at Pacific Resources.

Forty-eight percent of employers and 72% of disability insurance carriers expect employee disability and absence to have a bigger financial impact over the next five years. They cite key cost drivers, such as more disability claims, longer absences, increased use of Family Medical Leave Act (FMLA) benefits; and rising healthcare costs.

There is more uncertainty about how ACA will affect the number of disability claims, although those who feel knowledgeable on the subject are more likely to say there will be more claims as employees no longer fear losing healthcare coverage from a long-term absence. More say it will be more difficult to get access to routine care under ACA. Forty-two percent say it will get harder to see a physician for routine care in a timely manner while only 21% say it will get easier.

Employers handle their leave management Administration in a variety of ways including insourcing, outsourcing and a mix of the two. While the majority of respondents don’t expect to change their method of leave management administration over the next few years, there was some concern that FMLA activity will increase as a result of ACA and that more employers will look to outsource leave management.

Many employers are expanding programs to reduce absences and promote wellbeing, but few credit ACA as motivating these decisions – perhaps because many of their wellness initiatives were underway before the ACA was enacted. For more information, visit http://dmec.org.

Last Updated 11/25/2020

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