Mandates for Employer Health Care Hardly Reduce Number of Uninsured

January 18, 2006 ( - A new study released by the Employment Policies Institute shows that laws mandating employer-provided health care coverage do little to decrease the number of uninsured Americans.

In their study, Drs. Robert Fairlie and Rebecca London argue that factors such as employer size, employee status, and population demographics should be considered when creating mandates for health care.

The authors found that uninsured individuals at small firms are least likely to gain insurance from year to year. In addition, according to the study summary, those moving to employment in a small firm have the lowest rates of insurance gain, with only 32% of these individuals gaining insurance, compared to 68% of those moving to a large firm. The authors note that most health insurance mandates exempt small employers, but concede that expanding legislation past large employers could create a burden for smaller employers.

Richard Berman, executive director of the Employment Policies Institute, said in a news release. “Unfortunately, by proposing legislation that targets large employers, many lawmakers will keep most of their state’s uninsured out in the cold.”

In addition, the study shows that 38.3% of the individuals who spent the entire first year of the study unemployed were uninsured (compared to 14.4% of the total population). Nearly 18% of insured but unemployed adults lose coverage within the year. Overall, the authors found that unemployment and part-time status are associated with lower rates of insurance coverage and gain.

The results also showed that frequent job switching contributed to the uninsured level, and the authors noted that most mandates include a waiting period and do not cover unemployed adults.

As for demographics related to health care coverage, the study found that high school dropouts are 28% less likely to be covered than college graduates, and 18% less likely to be covered than high school graduates. More than one-third of these high school dropouts are uninsured.

Further, according to the report summary, minorities have lower rates of coverage than whites. African-Americans have an insurance rate of 80.5% compared to 89.2% for white, non-Latinos. During the two years of the study, African-Americans faced an insurance loss rate that was double that of whites.

“Disadvantaged minorities and less-educated workers are at high risk of health insurance loss, and generally low probability of gaining insurance,” said the authors, according to a news release. “It is clear that any policies aimed at improving health insurance coverage should consider ways to offer coverage to the demographic groups in greatest need.”

The full study report is here .