Among the many Yogi-isms, “This is like déjà vu all over again,” probably applies best to the results of a recent survey released by the NAM and IndustryWeek. The results showed health care costs are, again, the top challenge identified by manufacturers. A close second was “uncertainties related to the political climate”. The Affordable Care Act seems to be the common thread.
Manufacturers such as Vermeer Corporation offer employees and their families high-quality health plans and benefits, including an onsite health center, pharmacy and wellness incentives that truly contribute to improved health and lower costs. However, such actions will not be adopted by even well-intended manufacturers in the current environment of high costs involved with the implementation of the Affordable Care Act and its uncertainties.
Manufacturers have a high level of anxiety about implementation of the ACA – and rightly so. Health care costs continue to rise at rates well above inflation levels with no sign of abating. The main pillars of the law take effect in less than 10 months, but much of it needs to be up and running in October – less than seven months from today. Yet, we are only now getting a glimpse of the regulations detailing how things will work.
Manufacturers and businesses generally need predictability to thrive. A complete change in the health care delivery system with a host of known unknowns and unknown unknowns is not a good way to provide that predictability. This leads us to the third most identified concern – the unfavorable business climate due to taxes and regulation. The ACA includes a myriad of new taxes and regulations on all employers, which will continue to be a burden for years to come. A consistent burden of taxes and regulations is not the kind of stability that will create US jobs and help the manufacturing sector.
The great catcher Yogi Berra also said “You can observe a lot by watching.” We’ll be doing quite a bit of that in the coming months too.