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Trends in Employer Health Insurance

By March 6, 2017Commentary

The Medical Expenditure Panel Survey data collected by HHS includes information about where people get health coverage, if any, from.  A group from Minnesota accesses this survey data from the period 2011 to 2015, while the federal reform law was being implemented, to identify trends in employment-related health benefits.   (SHADAC Report)   There were around 120 million workers in 2015, employed at 7.2 million business establishments.  Of these workers, 101 million worked at a business which offered a health benefits plan, or 83.8%.  At these establishments with a health benefit plan, 76 million workers were eligible for the plan, or 76% of those employed at such businesses.  (A large number aren’t eligible because they are part time.)  Of these 76 million workers who were eligible, 57 million or 75% enrolled in the plan.  (This number is likely so low partly because the survey doesn’t count dependent coverage and some couples  who work may just use one spouse’s coverage.)  So the net is that less than half the workers eligible appear to actually enroll in health coverage, again ignoring the possibility of dependent coverage.

While the offer rate of health benefits was down in 2016, this was due to a small group decline of 2.8 percentage points, the offer rate actually went up 1.2 points for large groups.  Large groups offer rates have been stable for the last five years, while small group ones have declined slightly in the last couple of years. There is substantial variation across states in overall offer rates.  The percentage of all workers employed at companies offering a health plan has been stable.  But the number of eligible workers enrolled in the plan did go down from 2014 to 2015, by 1.7 percentage points.  Somewhat surprisingly, this decline occurred in large employers, not in small ones.  This could be due to costs as more large employers go to exclusively high-deductible plans.  There is again variation across states in the percent of workers who enroll when a plan is available.

In 2015, 39.4% of employees were enrolled in high-deductible plans.  For the last four years, this percent has been relatively stable for small employers but gone up for large ones.  There is a again a substantial rate difference between states.  According to this survey, the average single premium across all enrolled workers was about $6000 in 2015.  Average family coverage was around $17,300.  For the last five years, average annual increases in the single premium have been 3.4% and for family coverage 3.6%.  The worker’s share of these premiums has also been stable at 21% for single coverage and 27% for family.  This does not include the effects of greater cost-sharing or other benefit changes on costs.

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