5 Unpleasant Ways Employers Are Cutting Back on Healthcare Costs

The Affordable Care Act, perhaps better known as Obamacare, set in motion a series of changes that are drastically altering the health-services landscape.

The law itself was designed for a few purposes. Primarily, it was enacted in order to reduce the amount of uninsured citizens in this country, and to help spread the cost of medical care across a greater number of people. By doing so, long-term medical-cost inflation should be held in check and sticker shock could become a thing of the past.

However, whether healthcare cost inflation is under control is still very much up to debate.

According to a report released earlier this year from benefits consulting firm Buck Consultants, which surveyed 126 insurers and health-plan administrators across the country, employer’s health care costs are expected to rise by nearly 9% (preferred-provider organization plans up 8.7% and HMOs up 8.6%) in 2015. Considering the drastic nature of the changes brought upon by Obamacare, this is a potentially hefty increase for businesses to absorb.

Some companies, though, aren’t willing to simply take their lumps and “absorb” higher health care costs. They’re fighting back with cost-cutting tactics of their own – and in many cases these tactics are bad news for workers. Here are five of the most unpleasant ways that employers are reducing their exposure to ACA-related costs.

1. Showing workers the door
The easiest way for a large employer to cut costs is to simply show some of its employees the door. Fewer full-time workers mean lower health care costs, and as long as efficiency stays the same the business could come out ahead in the long run.

Privately held supermarket chain Price Chopper, for example, announced in June the first layoffs in its company’s history. Though it only amounted to 80 total employees, Price Chopper CEO Jerry Golub specifically cited “skyrocketing health care costs” as one of the reasons for trimming his company’s staff. To be fair, Golub also noted that increasing competition, rising fuel costs, rising wages, and reduced SNAP benefits also played a role in letting these 80 employees go.