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UPS drops 15,000 spouses from insurance plan, blames Affordable Care Act

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UPS made a major decision Thursday about how it insures its employees.

They say because of rising health care costs and President Obama's Affordable Care Act. UPS can longer afford to insure some of their employee's families.

It's important to note UPS employees are not losing coverage. Spouses who don't work or are not offered health insurance at their own jobs will continue to be covered too.

Still, thousands will be affected and some say, this is just a sign of things to come.

In an undated memo to employees, UPS announced coverage for all working spouses who are eligible for insurance with their own employer will no longer qualify for UPS health coverage. This applies to 15,000 people currently covered by UPS.

UPS blames several aspects of President Obama's Affordable Health Care Act for the decision, including mandatory coverage for dependent children up to the age of 26 and new government fees starting at $63 a head. The changes kick in January 1, 2014.

"The promises of the Affordable Health Care Act are not living up to the reality. The reality is if you like your coverage and you like your doctor, the chances are that you won't be able to keep that coverage and you won't be able to stay on the insurance plan you're on," said Texas Public Policy Foundation Healthcare Policy Analyst John Davidson. "We're going to see more of this stuff as we move forward with the Affordable Care Act."

"In 2014, people can go to the marketplace and get subsidized insurance. Bigger subsidies for the lowest income and then they taper off, but you can't go the marketplace and get a subsidy if you have an offer of job-based coverage, including through your spouse," Center for Public Policy Priorities Senior Policy Analyst, Stacey Pogue said. "If employers who have low wage workers do this, it could be a real savings for those families."

UPS claims 35 percent of companies plan on making similar changes to their insurance plans.

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