Opting out of health care coverage seen creating employee backlash

Maggie Wilderotter, chief executive officer at cable, Internet and phone provider Frontier Communications Corp. (FTR) says it’s her “fiduciary responsibility” to study ending medical benefits long provided by her company. As President Barack Obama presses ahead with plans to broaden insurance coverage, many U.S. executives say the Patient Protection and Affordable Care Act (PPACA) has them rethinking their options. Starting in 2014, the law’s $2,000 fine for not offering coverage appears to be far less than what most businesses pay for benefits. The losses, however, could add up quickly. The $2,000 fine is not tax-deductible like other expenses, and losing health coverage could cause not only employee disatisfaction, but a demand for higher salaries or a boost in other benefits in order to make up for the loss.