Study says companies expect reform to raise costs

INDIANAPOLIS (AP) - Benefits consultant Towers Watson says large companies think health care reform will raise their costs, and many employees will absorb some of that increase.

A survey of 661 companies conducted earlier this month found that 94 percent believe the reform law passed by Congress earlier this year will raise costs. A total of 88 percent plan to pass increases onto employees, and 74 percent anticipate reducing health benefits and programs.

Nearly three quarters of the companies surveyed expect to keep providing subsidized health coverage for their active workers. But the survey also found that 43 percent of employers that offer retiree benefits plan to reduce or eliminate them.