UPS Drops Spousal Healthcare Coverage, Cites ACA

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The United Parcel Service (UPS) announced plans to drop 15,000 employee spouses from its healthcare plan.  UPS said "rising medical costs, 'combined with the costs associated with the Affordable Care Act, have made it increasingly difficult to provide the same level of health care benefits to our employees at an affordable cost.'" (Washington Times, 8/22.)  UPS spokesman Andy McGowan says the company expects the move to save $60 million a year.

CNBC notes that according to a recent Towers Watson survey, "mid- to large-sized companies overwhelmingly expect health-care costs to increase under Obamacare--and most are eyeing possible changes to their health insurance offerings because of a looming excise tax for pricier plans under the health-care reform law."  In fact, the survey revealed that 40 percent of the 400+ companies surveyed said they will be changing the design of their insurance plans in 2014.  Nearly 60 percent of those companies see the state health insurance Marketplaces as a possible way to control costs by shifting the work of insuring their employees onto the Marketplaces in the future.

In response to the UPS announcement, FedEx Corp. "isn't travelling the same route as delivery competitor UPS when it comes to trying to cut out health benefits for spouses and other family members. (Pittsburgh Business Times, 8/22.)