UPS Joins Universities and Manufacturers in Cancelling Spousal Coverage

UPS Joins Universities and Manufacturers in Cancelling Spousal Coverage

Study Shows More Will Cease Offering Coverage

(Washington, D.C.) – This week the United Parcel Service (UPS) announced that it will discontinue spousal insurance coverage that it previously offered to 15,000 employees and their families and claims it will save $60 million a year in doing so. Rising medical costs and the costs associated with the Affordable Care Act make it difficult for the company to continue to provide the same benefits to workers, according to a UPS memo. While the Affordable Care Act requires large employers to cover employees and dependent children, it includes no such mandate for spouses or domestic partners.

According to news reports, UPS is the latest in a wide range of employers who are implementing the same policy which include universities, manufacturers, and others. Firms are finding that because the Affordable Care Act includes provisions that raise their overall health care costs, it makes financial sense to cancel coverage that was previously offered to spouses. One recent survey said that 4 percent of large employers were excluding spouses from coverage this year, and an additional 8 percent plan to next year – once the major provisions of the Affordable Care Act go into effect.

Daniel Garza, Executive Director of The LIBRE Initiative released the following statement:

“As we learn more of the nuances of the Affordable Care Act, it becomes clearer that  the law simply doesn’t work. As folks across America are praying to keep the job  they have, many are now seeing their 40-hour week slashed– due in part to the mandates in the law. Now, we learn that thousands of families are losing spousal insurance coverage because the law makes it too costly for employers to continue offering it. Unfortunately, this is just the tip of the iceberg. Experts predict that the law’s future effects include higher insurance premiums, longer wait times, and ultimately less access to doctors and to care. Congress must act now to repeal and replace this law with one that makes more sense for the all Americans.”

For interviews with a LIBRE representative, please contact: Judy Pino, 202-578-6424 or Brian Faughnan, 571-257-3309.