Report Finds Decline in Employer Health Insurance Coverage

State-Level Trends in Employer-Sponsored Health Insurance said this decline occurred across all income levels, along with a shift in the income distribution toward lower incomes. Over half of the decline in the number of people covered by ESI occurred in families with moderate incomes (between 200 and 399% of federal poverty guidelines). 

Nearly three-fifths (57%) of the decline in ESI was in dependent coverage, and most of the erosion of dependent coverage occurred in moderate-income families, according to the report. Among families with any ESI coverage, the percentage that had all family members enrolled in ESI declined. This decline in “whole-family” ESI coverage was larger for low and moderate income families.   

The report said changing employment patterns have also played a role in changing patterns of ESI coverage. Overall levels of employment and the distribution of employment by firm size influence access to ESI coverage. The percentage of employers that offer ESI has declined, and the employee “take-up” rate of coverage when they are eligible has also declined. The report contends that rising premiums have likely been a contributing factor to both declining employer offer and employee take-up of coverage.   

The report also found there is substantial variation across states in ESI prevalence, availability, cost, and the factors that influence the level of ESI coverage.