EBRI Issue Brief

The More Things Change, the More They Stay the Same: An Analysis of the Generosity of Employment-Based Health Insurance, 2013–2019

Oct 28, 2021 17  pages


In this paper we explore trends in actuarial value — or relative generosity of health plans — in the employment-based health coverage market since the implementation of the major coverage provisions of the Affordable Care Act (ACA) in 2014. Because there is a concern that workers would migrate to lower actuarial value (AV) plans in the exchanges if the Biden Health Care Plan were adopted, it is also important to know whether workers are already enrolling in lower AV plans in the employment-based market as a result of the ACA. In our analysis, we observe:

  • Both average and median AV were about 83 percent in each year from 2013 to 2019.
  • There were differences in average AV by plan type. The average AV for enrollees in health maintenance organizations (HMOs)/exclusive provider organizations (EPOs) was highest. This was followed by the AV of enrollees in fee-for-service plans. Preferred provider organization (PPO) and point of service (POS) enrollees saw an average AV of 85 percent and 84 percent, respectively. Not surprisingly, plans linked to spending accounts had the lowest AVs.
  • Average AV increased for every type of health plan between 2013 and 2019.
  • We did not find that demographics significantly affected plan choice.
  • We did find variation in AV by industry. Workers in retail trade, agriculture, forestry, fishing, construction, finance, insurance, and real estate are in the lowest AV plans. 

As opposed to group coverage, health insurance purchased in the individual market tends to be somewhat less generous in benefits, on average.

This study was conducted through the EBRI Center for Research on Health Benefits Innovation (EBRI CRHBI), with the funding support of the following organizations: Aon, Blue Cross Blue Shield Association, ICUBA, JP Morgan Chase, Pfizer, and PhRMA.