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McKinsey to Pay $39.5 Million to Settle ERISA Case

"McKinsey & Co. agreed to pay $39.5 million to settle a complaint that the company and an affiliate violated ERISA rules against self-dealing in the management of two company retirement plans.... McKinsey will retain an independent third party for at least three years 'to review the plans' investment options and review all expense reimbursements to McKinsey, MIO, or any other affiliated person or entity,' said the proposed settlement document[.]" [Bhatia v. McKinsey & Company, Inc., No. 19-1466 (S.D.N.Y. proposed settlement filed Aug. 10, 2020)]

McKinsey Drops Survey Details

After pressure from Democrats, consulting firm McKinsey released a statement ... , along with the full questionnaire about its now-controversial survey predicting a significant drop of [employer-sponsored health insurance] coverage due to health reform.

The McKinsey Report: Why Healthcare.gov Wouldn't Work at Launch

"In March, outside consultants from McKinsey & Co. were brought in to do a 'red team,' or outside progress report, on the system we know as HealthCare.gov.... [One] slide sums up most of the key problems we eventually saw with the rollout of HealthCare.gov last month: limited testing time, evolving requirements, over-reliance on contractors and 'stacking' of all the phases of development." [Also see the full McKinsey presentation.]

McKinsey Stands by Contested Health Insurance Survey

Meanwhile, yet another study is out today that conflicts with McKinsey's take on the matter. Avalere Health, a Washington-based consulting firm, did its own its own interviews and examined existing studies, and concluded that the overall market for employer-provided health insurance 'will likely remain relatively stable after 2014,' when the law takes full effect.

Democrats Question Validity of Mckinsey Health Care Plan Survey

'The shift away from employer-provided health insurance will be vastly greater than expected and will make sense for many companies and lower-income workers alike,' said the study, published in the June issue of McKinsey Quarterly.

Controversial McKinsey Health Care Study Creates Major Dissent at Firm

The consulting firm McKinsey & Company was thrust into the political spotlight Tuesday after it published a study -- at odds with the expert consensus -- finding that, once fully implemented, the health care reform law will drive huge numbers of employers to drop or dramatically restructure their companies' health care benefits.

Premiums Up Six Percent on ACA Exchanges, McKinsey Finds

"Despite an influx of new carriers and plans, premiums for health insurance plans sold on [ACA] exchanges rose 6 percent between 2014 and 2015 ... In all, 125 products are available on public exchanges for 2015, compared to 98 last year. The average number of plans available in any one U.S. county is 40, compared to 31 last year.... If all exchange enrollees were to renew the insurance they purchased in 2014, the vast majority -- 85 percent -- would have higher premiums."

Massive Settlement Struck in 401(k) Excessive Fee Suit

"In a remarkably short period, an excessive fee suit involving proprietary funds has settled for what may be the largest monetary settlement among those cases to date.... [U]nder the terms of the proposed Settlement, McKinsey (and/or its insurers) will pay a Gross Settlement Amount of $39,500,000 into a common fund for some 33,000 current and former participants." [Bhatia v. McKinsey & Company, Inc., No. 19-1466 (S.D.N.Y. proposed settlement filed Aug. 10, 2020)]

Will More Employers Drop Coverage Under the ACA? Don't Bet on It

"According to a new study by Deloitte consulting, around one in 10 U.S. employers with more than 50 workers plans to drop health coverage in the next few years as the main provisions of the Affordable Care Act kick in.... This finding is reminiscent of another employer survey released by McKinsey in June 2011.... [which] reported that when the ACA fully takes effect in 2014, it could prompt 30% of employers to drop coverage, pay the modest fine, and let their employees pursue coverage through one of the new state-based health insurance exchanges. A problem with using surveys like Deloitte's or McKinsey's to predict behavior is that they measure employer sentiment toward the ACA today, rather than the economic decisions employers typically make when the time comes."

What Will 2014 Mean for Employees' Healthcare Plan Coverage If ACA Is Still Around?

Is there an explanation for this disparity [between the McKinsey survey reporting that 30 percent of employers will be dropping employer-sponsord health insurance and the IFEBP survey that reports only 0.7 percent]? McKinsey posits that, the more employers are aware of healthcare reform, the more interested they are in pursuing alternatives to traditional coverage.... Many of the employers surveyed by IFEBP had also thought through the implications of healthcare reform, though.