SAN FRANCISCO (MarketWatch) — Republican lawmakers emboldened by victories in the midterm elections are angling to repeal or defund the health-care overhaul that President Obama signed into law earlier this year. But many large employers are pushing for changes and not full repeal.

Because health reform is the law of the land, attention to the renewed political turmoil over it often takes a back seat as big employers focus on interpreting and complying with the new rules, experts say.

Hemodialysis, at home

“They don’t want to repeal it,” said Geoff Manville, principal in Mercer’s Washington Resource Group. “But large employers for their part want to amend the law and make changes, largely around provider payments and delivery-system reform.”

In general, big employers would like to see more aggressive pay-for-performance measures that aim to improve patients’ health results while reducing costs in the Medicare program, he said. “That’s the 800-pound gorilla that drives the entire health-care system.”

Other employer groups echo the desire to modify pieces of the legislation instead of overturning it altogether. Fifty-six percent of employers say there’s a need for major adjustments to the new law, but only 3% want it repealed, according to a report of 250 chief human-resource officers released last month by the HR Policy Association, a group of large employers’ human-resource directors.

“ ‘They’re saying this is the law, this is what we need to do, so let’s just focus on that.’ ” — Steve Wojcik, National Business Group on Health

Big companies have been consumed with the details of complying with the law’s most immediate requirements, including allowing adult children to remain on their parents’ policies until age 26 starting next year, said Steve Wojcik, vice president for public policy for the Washington-based National Business Group on Health, which represents more than 300 large employers on national health-policy issues.

“They’re saying this is the law, this is what we need to do, so let’s just focus on that,” Wojcik said. “We know there’s a climate of uncertainty, but we need to act on what the law requires us to do now.”

A key priority for large employers is making sure the administration of new government requirements is as simple and straightforward as possible, he said.

With changes to health benefits for the 2011 open-enrollment season already worked out, big employers are turning their attention to two of the provisions next in line for them to address: how to calculate the value of employees’ health benefits to include on their W-2 forms and how to automatically enroll workers in a default health plan of the employer’s choosing when necessary.

“There are some ambiguities about how to value the benefit and what to report,” he said of the W-2 issue.

Longer term, large employers would like to see the law adjusted to crack down on rapid health-care cost growth, Wojcik said. “We hope there’s an increased effort to really address the cost drivers in health care, which was promised in the beginning of the process and then dropped along the way.”

The desire for more discretion in tailoring health benefits to their particular work forces is another issue brewing on the horizon before 2014, Manville said.

That’s when some of the law’s biggest changes kick in. For the first time, people will be required to have health insurance and new insurance marketplaces known as exchanges will offer more standardized coverage to individuals and small groups, with subsidies for people who can’t afford it.

“There is concern that more employees will get their coverage through these exchanges in 2014 than Congress bargained for,” Manville said.

Split picture

Republicans have been campaigning to “repeal and replace” health reform since it was enacted earlier this year. Their big election-night gains in the U.S. House of Representatives and in governors’ houses across the country have given them cover to sharpen their attacks.

On Wednesday, John Boehner, the Ohio Republican poised to become House speaker, called the bill a “monstrosity” and said his party would use the next few months to plan a strategy to repeal it. While repeal is unlikely considering Democrats’ control of the Senate and White House, newly empowered congressional Republicans could chip away at the law by calling investigations and withholding some of the funding necessary to expand coverage as planned.

Even some Democrats said the legislation was a work in progress during their midterm campaigns, but it’s unclear what kind of adjustments they would consider, Manville said.

“I wouldn’t expect any major changes because it’s such a carefully calibrated compromise,” he said.

President Obama said Wednesday he was open to tweaking specific features that appeared to be doing more harm than good, such as an unpopular requirement that small businesses file 1099 forms for any business that provides them with more than $600 in goods or services. But he defended the health-reform law as the right thing to do to shore up Americans’ health security and start controlling costs.

“We’d be misreading the election if we thought that the American people would want to see us for the next two years re-litigate the arguments we had for the last two years,” Obama said. Read about how a conciliatory Obama vows to work with GOP.

The long and sometimes bitter public debate on whether and how to create a comprehensive health-care overhaul cooled off when Congress narrowly passed a bill and Obama signed it into law in March. But nearly eight months later, Americans appear unchanged in their views on the issue, depending on their party affiliation and how the survey questions are worded. People across the political spectrum tend to support individual provisions such as forcing insurance companies to cover people with preexisting conditions, even if they have a negative view of the law overall.

Americans are similarly divided on whether to overturn the law. About half of voters favor repealing it, nearly equal to the percentage of those who want to keep the law in tact or expand it, according to a national exit poll by CBS News on Tuesday.

Large employers’ more amenable view toward health reform is at odds with many of their small-employer counterparts. The National Federation of Independent Business, which lobbied against health reform and called it a job-killer, is now challenging its constitutionality with lawsuits in 20 states.

But small employers aren’t uniformly opposed to the health-care overhaul. The Small Business Majority supports it, saying its members will fare better with the changes.

Meanwhile, a targeted tax credit in the health-reform law appear to be helping more small businesses offer insurance to their workers.

The portion of employers with three to nine workers that offer coverage jumped to 59% in 2010 from 46% in 2009, according to a Wall Street Journal story that cited a report from Bernstein Research. An estimated 4 million small businesses are expected to qualify for the tax credit, which covers up to 35% of premium costs for eligible employers.