This EBRI Notes article examines the percentage of employers offering health insurance from 2008–2016 to better understand how health insurance offer rates may have been affected by the Patient Protection and Affordable Care Act of 2010 (ACA), the Great Recession of 2007–2009, and the subsequent economic recovery. The data come from the Medical Expenditure Panel Survey–Insurance Component (MEPS-IC).
Many employers were expected to drop workplace health insurance with the introduction of the ACA. Since 2008, the percentage of coverage-offering employers with 1,000 or more employees has been consistently near or above 99 percent—it reached 99.8 percent in 2016—but smaller firms have shown a steady, though not precipitous, decline in offer rates. For the smallest employers studied, those with fewer than 10 employees, the offer rate declined from 22.7 percent in 2015 to 21.7 percent in 2016.
But over the last year, perhaps with the strengthening economy and lower unemployment rates, there is evidence of what may be a rebound in employment-based coverage offer rates among firms with 10-999 employees. More specifically, from 2015-2016:
For employers with 10–24 employees, those offering health benefits increased from 48.9 percent to 49.4 percent.
For employers with 25–99 employees, those offering health benefits increased from 73.5 percent to 74.6 percent.
For employers with 100-999 employees, those offering health benefits increased from 95.1 percent to 96.3 percent. For these employers, this trend actually began a year earlier, when the offer rate increased from 92.5 percent in 2014 to 95.1 percent in 2015.
This paper discusses the context for the recent rebound and suggests factors that may influence future trends.
The National Business Group on Health said Tuesday the percentage increase large companies will see next year is similar to 5% cost increases employers have experienced for five years. In its annual survey of large employers, NBGH says per employee costs are projected to increase 5% to $14,156 in 2018 compared to $13,482 per employee this year . Since employers generally cover about 70% of worker costs, employees’ 30% share next year will be nearly $4,400, which includes premium and out-of-pocket expenses
Cyclical Job Ladders by Firm Size and Firm Wage by John Haltiwanger, Henry R. Hyatt, Lisa Kahn, Erika McEntarfer :: SSRNJune 24, 2017
We study whether workers progress up firm wage and size job ladders, and the cyclicality of this movement. Search theory predicts that workers should flow towards larger, higher paying firms. However, we see little evidence of a firm size ladder, partly because small, young firms poach workers from all other businesses. In contrast, we find strong evidence of a firm wage ladder that is highly procyclical. During the Great Recession, this firm wage ladder collapsed, with net worker reallocation to higher wage firms falling to zero. The earnings consequences from this lack of upward progression are sizable.
Using US Census employer-employee matched data, I show that employer financial distress accelerates the exit of employees to found start-ups. This effect is particularly evident when distressed firms are less able to enforce contracts restricting employee mobility into competing firms. Entrepreneurs exiting financially distressed employers earn higher wages prior to the exit and after founding start-ups, compared to entrepreneurs exiting non-distressed firms. Consistent with distressed firms losing higher-quality workers, their start-ups have higher average employment and payroll growth. The results suggest that the social costs of distress might be lower than the private costs to financially distressed firms.
Governor Charlie Baker of Massachusetts has proposed a tax of $2,000 per worker on businesses which do not offer health coverage to employees who become dependent on Medicaid.
The first state in the nation to require residents to carry health insurance is grappling with escalating Medicaid rolls, but a fix floated by Massachusetts’ Republican governor is drawing pushback from employers.
Gov. Charlie Baker will propose in his annual budget on Wednesday a $2,000 penalty per worker on businesses that don’t shoulder enough of the health-insurance cost. The governor is aiming to solve what he sees as a flaw in the national health law: Medicaid ends up being more appealing to low-income workers than insurance offered by employers, raising the costs for the state.
Research from the American Action Forum (AAF) finds regulations from the Affordable Care Act (ACA) are driving up health care premiums and are costing small business employees at least $19 billion in lost wages annually. These figures varied by state, but in 2015 the ACA cost year-round workers $2,095, $2,134, and $2,260 in Ohio, New York, and North Dakota, respectively. Premium increases, a prospect regulators predicted when issuing the first ACA regulations, also significantly diminished the number of business establishments and jobs nationwide. Across the country, small businesses (20-99 workers) lost 295,030 jobs, 10,130 business establishments, and $4.7 billion in total wage earnings. Florida lost 17,950 jobs; Ohio lost 19,000; Pennsylvania lost 15,680; and Texas lost 28,010 jobs due to higher sensitivity to rising health care premiums and the ACA.