Study Charts Workplace Health Coverage Trends

November 7, 2005 (PLANSPONSOR.com) - The decade between 1994 and 2004 saw a significant trend reversal in health coverage, according to a new study.

The Employee Benefit Research Institute (EBRI) reported employment-based coverage expanded significantly between 1994 and 2000 to outpace growth in public health coverage programs, according to an EBRI news release. But, since then, the dynamic reversed as public programs expanded and employment-based coverage declined.

However, workplace health coverage is still a key domestic policy issue, according to EBRI, because the great majority of Americans who have health insurance get it through work. Overall, in 2004 the percentage of working-age residents (under 65) with health insurance was 82.2% – a 10-year high.

The study noted distinct shifts in employment-based coverage during the 10-year period. From 1994 – 1997, coverage held steady as the cost of providing health benefits to workers was flat. From 1997 – 2000, the percentage of working adults with employment-based coverage increased – the result, in part, of a greater percentage of small firms offering health benefits despite rising costs. Since 2000, the percentage of working-age Americans and the actual number of those with coverage has declined.

As for the recent trends, the study showed:

  • The percentage of US residents under age 65 covered by employment-based coverage dipped 2% – from 64.4% in 1994 to 62.4% in 2004. Coverage rose during the first half of the period, hitting a peak of 66.8% in 2000, but it fell after that.
  • Because of population increases, the overall number ofUS residents with employment-based coverage grew from 148.1 million in 1994 to 159.1 million in 2004 – even as the percentage with coverage declined.
  • Participation in public programs declined from 1994 to 1999, the study said. The percentage of US residents enrolled in Medicaid fell as former welfare recipients entered the work force during the then-thriving economy.

Finally, the study offered this glimpse into the future: “If current economic conditions persist or worsen, maybe due to the economic fallout of hurricanes Katrina and Rita, coupled with the rising cost of providing health benefits, the nation is likely to continue to see an erosion in the percentage of individuals with employment-based health insurance coverage, and – if public programs do not keep pace with this erosion – more individuals without health insurance.”

The study, Sources of Health Insurance and Characteristics of the Uninsured: Analysis of the March Current Population Survey, is available here .

«