Following Tennessee Governor Phil Bredesen’s op-ed in last Thursday’s Wall Street Journal, the Associated Press has a story noting that “corporate number crunchers are looking at options that could lead to major changes” in health insurance plans for workers.  Among the quotes from benefits managers in the piece:

• A consultant from Deloitte: “What we are hearing in our meetings is, ‘We don’t want to be the first one to drop benefits, but we would be the fast second.’  We are hearing that a lot.”
• American Benefits Council President James Klein: “My conclusion on all of this is that it is a huge roll of the dice….[The health care law] could begin to dismantle the employer-based system.”
• More from the Deloitte consultant: “I don’t know if the intent was to find an exit strategy for providing benefits, but the bill as written provides the mechanism.”

As the recent reports have showed, many employers may choose to drop coverage and pay a $2,000 tax rather than paying for a worker’s insurance policy that could cost upwards of $10,000 for family coverage.  And former Congressional Budget Office Director Doug Holtz-Eakin’s analysis confirms that, should employers decide to drop coverage, the cost of federal insurance subsidies will explode as employers shed their plans – making any promise of deficit reduction as a result of the law little more than a mirage.

RPC Analyst Chris Jacobs