________ “Counting the Uninsured: small firms (chart 12). Most small employers report that offering health benefits helps with recruitment and A Comparison of National Surveys.” EBRI Issue Brief no. 225 (Employee Health Insurance Coverage EBRI retention, and keeps workers healthy Benefit Research Institute, September 2000). , which ultimately reduces absenteeism and increases productivity (Fronstin The most recent Census Bureau data shows that for the first time since at least 1987, the number of Chart 5 Chart 8 Chart 12 Chart 3 Chart 10 Chart 1 EMPLOYEE and Helman, 2000). Clearly Fronstin, Paul, and Rachel Christensen. “The Relationship Between Income and the Uninsured.” , many employers realize there is real business value in providing health care coverage EBRI Notes, no. Americans without health insurance coverage has declined. In 1998, the number of uninsured (nonelderly) Percentage of Employers Offering Health Benefits, by Firm Size, 1998-2000 Percentage of Children, Ages 0-17, With Medicaid, 1987-1999 Percentage of Working Adults, Ages 18-64, Percentage of Americans Ages 0-64 Number of Uninsured Americans Ages 0-64, 1987-1999 BENEFIT Percentage of Americans Ages 0-64 with Medicaid Coverage, 1987-1999 to their workers. 3 (Employee Benefit Research Institute, March 2000): 1–4. Americans had reached 43.9 million (chart 1). In 1999, the number of nonelderly Americans without health Without Health Insurance Coverage, 1987-1999 T-124 With Employment-Based Health Insurance Coverage, 1987-1999 RESEARCH 30% Fronstin, Paul, and Lawrence G. Goldberg, and Philip K. Robins. “Differences in Private Health Insurance Cover Also worth mentioning is that American workers clearly identify health insurance coverage as far and 100% - 50 insurance coverage declined to 42.1 million. The percentage of nonelderly Americans without health insurance 99% 99% 14% INSTITUTE 100% ® 70% away the single most valued work-place benefit. When asked to rank the importance of all employee benefits, age for W 20% orking Male Hispanics.” Inquiry. Vol. 34, no. 2 (Summer 1997): 171–180. coverage declined from 18.4 percent in 1998 to 17.5 percent in 1999 (chart 2). 12.7% 69.2% 12.5% 12.5% 43.9 1998 1999 2000 18.2% 69.0% 43.1 18.1% 45 12.1% Fronstin, Paul, Lawrence G. Goldberg, and Philip K. Robins. “An health benefits are by far the benefit most valued by workers and their families. Sixty-five percent of workers 17.8% 17.8% 17.8% Analysis of Trends in Private Health Insurance The main reason for the decline in the number of uninsured Americans is the strong economy and low 17.6% 42.1 17.5% 17.5% 68.6% 11.8% 17.3% 41.4 69% 23.9% 25% 12% 16.8% 16.8% 40.3 23.2% responding to a recent EBRI survey rated employment-based health benefits as the most important benefit Coverage, 1988–1992.” Social Science Quarterly. Vol. 78, no. 1 (March 1997). 22.9% 39.3 39.4 unemployment. Since employment-based health insurance is by far the most common source of health coverage in 11.1% 11.0% 22.0% 38.3 40 21.8% 80% 15.6% 68% (Salisbury and Ostuw Fronstin, Paul, and Ruth Helman. “Small Employers and Health Benefits: Findings from the 2000 Small Em- , 2000). 10.4% 10.4% the United States, it is not surprising that the lower rate of unemployment is beginning to translate into lower 20.8% 36.3 10.2% 20.5% 35.6 14.6% 20.2% 19.8% 67.0% 15% 34.3 67% ployer Health Benefits Survey.” EBRI Issue Brief no. 226 (Employee Benefit Research Institute, October 2000). 33.6 rates of uninsured. 10% As a result of the strong economy 18.9% , more workers and their dependents are covered by employ- 20% 35 67% 31.8 66.3% 8.8% 60% 60% Fronstin, Paul, and Sarah C. Snider 8.7% . “An Examination of the Decline in Employment-Based Health Insurance The Future ment-based health insurance: Between 1998 and 1999 the percentage of nonelderly 8.6% Americans covered by employ- 65.8% 60% 16.0% 55% 15.9% 54% 66% Between 1988 and 1993.” 30 15.5% Inquiry. Vol. 33, no. 4 (W Statement inter 1996/97): 317–325. When findings from the March 2001 CPS are released, I expect the data for 2000 will show that the ment-based health insurance increased from 64.9 percent to 65.8 percent (chart 3). 8% 49% 64.9% 15% Gabel, Jon, et al. “Job-Based Health Insurance In 2000: Premiums Rise Sharply While Coverage Grows.” Health number of uninsured Employment-based health insurance coverage increased substantially for adult workers last year Americans continued to decline. The drop may even be larger than the 1.7 million decline 64.7% . In 65% 10% 25 64.2% Affairs. Vol. 19, no. 3 (September/October 2000): 144–151. experienced between 1998 and 1999. 1998, 72.8 percent of workers were covered by an employment-based health plan (chart 4). By 1999, 73.3 percent As mentioned above, between 1998 and 2000, the percentage of firms with Written for the 64.0% 40% 63.8% 63.6% 64% Health Care Financing 6% Administration (HCFA). The State Children’ 63.5% s Health Insurance Program Annual Enroll- three to 199 employees offering health benefits increased (Gabel, 2000). In addition, S-CHIP will continue to were covered. The likelihood that an adult worker was uninsured declined from 18.1 percent in 1998 to 17.5 per- 20 10% ment Report (October 1, 1998–September 30, 1999). expand health insurance coverage. Last week, the Clinton administration announced that 2.5 million children had cent in 1999 (chart 5). Even nonworking adults experienced an increase in the likelihood of having employment- 63% United States Senate Finance Committee Salisbury, Dallas L., and Pamela Ostuw. “Value of Benefits Constant in a Changing Job Environment: The 1999 been enrolled in the S-CHIP based health insurance coverage, increasing from 40.5 percent in 1998 to 41.7 percent in 1999 (chart 6). program by June 30, 2000. An October 1999 report by the Health Care Finance 15 4% 5% 20% 62% WorldatWork/EBRI Value of Benefits Survey.” EBRI Notes, no. 6 (Employee Benefit Research Institute, June Administration predicted that 2.7 million children would be enrolled in S-CHIP by Sept. 30, 2000. This combina- The likelihood that a child is covered by employment-based health insurance has been increasing since 5% 2000): 5–6. 10 1994 (chart 7). In 1994, 58.1 percent of children were covered by employment-based health insurance. By 1999, tion of more employers adding health benefits, along with more children covered by S-CHIP, will result in contin- 61% Hearing on 2% William M. Mercer. Mercer/Foster Higgins National Survey of Employer-sponsored Health Plans 1999. New York, ued expansion of health insurance coverage. 61.5 percent were covered. Because of declining enrollment in Medicaid (chart 8), the percentage of children 0% 5 Living Without Health Insurance: Who’s Uninsured and Why? 0% 60% NY: William M. Mercer, Inc., 2000. without health insurance coverage has actually been growing over most of this period. However It is also worth noting that while the uninsured declined between 1998 and 1999, it did not drop by , between 1998 0% 3-9 Workers 3-199 Workers 200+ Workers 1987 1987 1988 19881989 19891990 1990 1991 1991 1992 1992 1993 1993 1994 19941995 19951996 1996 1997 1997 1998 1998 1999 1999 and 1999, the percentage of children without health insurance coverage declined dramatically from 15.4 percent to 44 million. More than 42 million Americans continue to be uninsured. Even if the number drops again next year, 0% 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 0 1 The CPS (and most other surveys) are well known for under-reporting Medicaid coverage and coverage from when the 2000 data are released, it is likely that 40 million 13.9 percent (chart 9). Americans will still be uninsured—more than 15 per- 1987 1987 1988 1988 1989 1989 1990 1990 1991 1991 1992 1992 1993 1993 1994 1994 1995 1995 1996 1996 1997 1997 1998 1998 1999 1999 Source: Jon Gabel et al., "Job-Based Health Insurance in 2000: Premiums Rise Sharply other government programs. In the case of the CPS, it may not be picking up all Medicaid recipients because some cent of the population. Despite the State Children’ Source: Employee As long as the economy is strong and unemployment is low Benefit s Health Insurance Program (S-CHIP), public health insurance coverage is not Research Institute. , employment-based health Source: Source: While Employee Employee Coverage Benefit Grows," Benefit Research Research Health Institute. Affairs Institute. Vo. 19, no. 3 (September/October 2000): Source: Employee Benefit Research Institute. states do not call the program Medicaid. In fact, there is strong evidence that the CPS under-reports Medicaid insurance coverage will expand and the uninsured will gradually decline. However increasing. Between 1998 and 1999 the percentage of nonelderly 144–151. Americans covered by Medicaid and other , even if the United States Source: Employee Benefit Research Institute. by coverage, based on comparisons of these data with enrollment and participation data provided by the Health Care experienced five more years of similar declines in the uninsured as it did in 1999, 34 million government-sponsored health insurance coverage did not change (chart 10)—remaining at 10.4 percent in 1999. Americans would still Paul Fronstin, Ph.D. Financing Administration (HCFA), the federal agency primarily responsible for administering Medicaid. See Paul be uninsured in 2005 (chart 13). If the economy continues to soften or comes close to a recession the uninsured While the March Current Population Survey (CPS) does not allow researchers to count the number of children Fronstin, “Counting the Uninsured: A Comparison of National Surveys,” EBRI Issue Brief no. 225, Employee would easily and quickly start to increase again as unemployment rises. Even for those who keep their jobs, small enrolled in S-CHIP, it does appear that some children benefited from expansions in government-funded programs. Senior Research Associate and Benefit Research Institute, September 2000, for more information. employers would likely drop health benefits, and large employers would likely shift the cost of coverage onto Findings from the CPS indicate that the percentage of children in families just above the poverty level without Chart 11 Chart 2 Chart 13 Director, Health Security and Quality Research Program Chart 4 workers, resulting in fewer workers accepting coverage. If the uninsured returned to its 1999 level of 17.5 percent health insurance coverage declined dramatically, from 27.2 percent uninsured in 1998 to 19.7 percent uninsured in Chart 9 Percentage of Americans Ages 0-64 Without Health Insurance, 1987-1999 Premium Increases by Firm Size, 1988-2000 Number of Uninsured Americans, Ages 0-64, Chart 6 Percentage of Working Adults, Ages 18-64, of the nonelderly population, 38 million 1999. Some of the decline can be attributed to expansions in Medicaid and S-CHIP 14% Americans would be uninsured in 2005. In contrast, if the downturn in . Between 1998 and 1999, the Percentage of Children, Ages 0-17, Various Assumptions About Percent Uninsured, 1999-2010 20% Percentage of Nonworking Adults, Ages 18-64, with Employment-Based Health Insurance Coverage, 1987-1999 percentage of near the economy was severe and the uninsured represented 25 per -poor children covered by these programs increased from 39.3 percent to 40.5 percent. However -cent of the nonelderly population, 63 million , Without Health Insurance Coverage, 1987-1999 70 18.4% 18.3% With Employment-Based Health Insurance Coverage, 1987-1999 12.0% Americans would be uninsured.Employee Benefit Research Institute 17.7% it appears that expansions in employment-based health insurance had an even larger effect. Specifically, the 17.5% 80% 17.4% 17.3% 18% 66 All Firms 17.1% Small Firms (3-199 Workers) 63 12% 17.0% 20% 61 percentage of near-poor children covered by an employment-based health insurance plan increased from 30.5 per 2121 K Street NW, Suite 600 - 16.3% 50% 16.1% 46.4% 60 46.2% 15.7% 1 10.3% 15.5% 45.1% 59 cent to 34.5 percent. Bibliography 16% Washington, DC 20037 53 14.8% 76.1% 43.3% 45% 42.0% 75.5% 41.7% 10% 15.4% Fronstin, Paul. “Children Without Health Insurance: 48 An Analysis of the Increase in Uninsured Children Between 40.5% Voice: 202/775-6300 15.0% 39.7% 14.8% 39.1% 38.8% 39.0% 38.7%38.7% 14% 14.2% 15% 75% 50 40% 73.9% 73.9% 13.9% 1992 and 1993.” Inquiry. Vol. 32, no. 3 (Fall 1995): 353–359. 13.7% 13.8% 13.6% 8.5% Fax: 202/775-6312 13.3% 13.2% 45 73.3% 8.3% 13.1% 12.9% 12.7% 72.8% 46 Health Insurance Costs and Benefits ________. “Trends in Health Insurance Coverage.” EBRI Issue Brief no. 185 (Employee Benefit Research Institute, 72.4%72.4% 72.3% 72.2% 72.2% 43 72.2% 35% 8% 12% Internet: http://www.ebri.org 71.8% 38 6.9% 41 May 1997). It is notable that this decline in the uninsured has occurred at a time when health insurance costs are 40 39 30% 42 ________. “Employment-Based Health Insurance: going up. Since 1998, health insurance cost inflation has been increasing. A Look at Tax Issues and Public Opinion.” According to data from a recent study EBRI Issue Brief no. 10% 10% 70% 6% (Gabel et al., 2000), health insurance costs increased 8.3 percent for all firms between spring 1999 and spring 211 (Employee Benefit Research Institute, July 1999). 25% 5.2% 37 30 8% 2000, and they increased 10.3 percent for smaller firms (with between three and 199 workers) (chart 1 ________. “Employment-Based Health Insurance: A Look at Who is Offered Coverage and Who T 34 akes It.” 28 1). When EBRI 20% health care costs increase, health insurance coverage would be expected to decline, with employers shifting the Issue Brief no. 213 (Employee Benefit Research Institute, September 1999). 4.8% 4% 6% 5% 20 15% March 13, 2001 cost of coverage onto workers, or even dropping coverage completely ________. “Employment-Based Health Insurance For Children: Why Did Coverage Increase In the Mid-1990s?” . But as shown above, more workers and their 65% 2.1% dependents were covered by employment-based health insurance coverage in 1999 than in 1998. Employers have Health Affairs. Vol. 18, no. 5 (September/October 1999): 131–136. 10% 4% 2% 17.6% 15% 25% Gradual Decline Constant Increase not been shifting the cost onto workers. ________. “Sources of Health Insurance Coverage and Characteristics of the Uninsured: An annual survey by William M. Mercer indicates that the worker share Analysis of the March 10 5% 0% 2% of the premium has been unchanged since 1993 (W 1999 Current Population Survey.” EBRI Issue Brief illiam M. Mercer no. 217 (Employee Benefit Research Institute, January , 2000). In contrast, an annual survey by the 0.8% 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 Kaiser Family Foundation and the Health Research and Educational T 2000).0% rust found that there was a slight reduction 60% 0% 0 The views expressed in this statement are solely those of the author and should not be attributed to the 0% between 1996 and 2000 in the percentage of the premium workers were required to pay (Gabel, 2000). ________. “The Working Uninsured: Who They Are, How They Have Changed, and the Consequences of Being 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 Employee Benefit Research Institute, or the EBRI Education and Research Fund, its officers, trustees, 1987 1988 1999 1989 1990 1991 2000 1992 1993 1994 2005 1995 1996 1997 1998 20101999 Uninsured.” Despite rising health insurance costs, employers are increasingly offering health benefits to workers— EBRI Issue Brief no. 224 (Employee Benefit Research Institute, August 2000). sponsors, or other staff. The Employee Benefit Research Institute is a nonprofit, nonpartisan, public policy Year Source: Employee Benefit Research Institute. ________. “Health Insurance Coverage and the Job Market in California.” again, because of the tight labor market. Between 1998 and 2000, the percentage of small firms offering health Source: Source: Jon Gabel Employee et al., Benefit "Job-Based Research Health Institute. Insurance in 2000: EBRI Special Report Premiums Rise Sharply no. 36 (Employee Source: Employee Benefit Research Institute. research organization which does not lobby or take positions on legislative proposals. Source: Employee Benefit Research Institute. While Coverage Grows," Health Affairs Vo. 19, no. 3 (September/October 2000): 144–151. benefits increased from 54 percent to 67 percent, with much of that increase occurring among the smallest of the Benefit Research Institute, September 2000). Source: Employee Benefit Research Institute. 1 6 4 2 3 9 8 5 7 Millions Millions Uninsured