UPS Discontinues Spousal Coverage Over ObamaCare

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( – August 21, 2013) Portland, OR – UPS recently joined a growing list of big companies planning to discontinue health benefits. In this particular case, it involves the coverage of employees’ spouses that can possibly get coverage elsewhere. The decision affects roughly 15,000 employees, mostly in management positions.

The vast majority of the company’s workers are unionized through the International Brotherhood of Teamsters and receive their insurance benefits under a different plan.

Increased medical costs, “combined with the costs associated with the Affordable Care Act (ACA), have made it increasingly difficult to continue providing the same level of healthcare benefits to our employees at an affordable cost,” UPS said in a memo to employees.

UPS claims the reason is based on several aspects of Obamacare, including mandatory coverage for dependent children up to age 26 and new government fees.

“We are making these changes to offset cost increases due to the [Affordable Care Act],” the memo states.

The memo also states that UPS said its health care costs usually increase about 7% a year, but that it expects those costs to climb by 11.25% in 2014 due to Obamacare.

These 15,000 spouses will be forced to find coverage under different plans. According to USA Today, it will be difficult for them to find similar coverage because the UPS plan is far more generous than the national average.

Many employers are worried about the effects that ObamaCare will have on business. And you can be sure that premiums will rise. Not only that, they’ll also be required to pay a fee for every person on their plans, starting at $63 a head next year.

The federal Department of Health and Human Services has said the fee would help with the transition as the American health care system accepts many new sick, previously uninsured people.

But time will tell as more people really read what congress had to pass back in 2010.