Employment-Based Health Coverage Continues to Decline

September 26, 2011 (PLANSPONSOR.com) – According to a report from the Employee Benefit Research Institute (EBRI), employment-based health coverage has been declining since 1994.

While employment-based health coverage is still the dominant source of health insurance in the U.S., it has been steadily shrinking for 18 years.

The report, “Sources of Health Insurance and Characteristics of the Uninsured: Analysis of the March 2011 Current Population Survey,” found that in 2010, 58.7% of the non-elderly population (under age 65) had employment-based health benefits, down from 69.3% in 2000.

However, public program health coverage expanded last year, accounting for 21.6% of the non-elderly population. Enrollment in Medicaid and the State Children’s Health Insurance Program increased, covering 16.9% of the non-elderly population in 2010 and significantly higher than the 10.2% level of 1999.

The EBRI report notes that while the percentage of non-elderly Americans with health insurance declined slightly in from 2009 to 81.5% in 2010, the change was not statistically significant. The percentage of nonelderly individuals who were uninsured was 18.5% in 2010, up from 18.3% in 2009, its highest level during the 1994‒2010 period.

EBRI’s estimates on the uninsured are somewhat higher than those reported by CPS: EBRI focuses on the non-elderly population because this group can receive health insurance coverage from a number of different sources, and because Medicare (the federal health insurance program for the elderly and disabled) covers nearly all individuals age 65 and older.

“These trends clearly reflect job losses from the 2007–2009 recession and continuing slow economic recovery. While the unemployment rate this year has been about 9%—slightly lower than in 2010—it remains high, and there is a continued threat of a double-dip recession increasing it even further,” said Paul Fronstin, Director of the EBRI’s Health Research and Education Program, and author of the report. “As a result, the nation is likely to see continued erosion of employment-based health benefits when the data for 2011 are released in 2012. Fewer working individuals translates into fewer individuals with access to health benefits in the work place.”

Full details of the EBRI report are published in the September 2011 EBRI Issue Brief, availableonline at www.ebri.org.

Tara Cantore
editors@plansponsor.com