Health Insurance Eroding for Working Families: Employer-Provided Coverage Declines for Fifth Consecutive Year

Abstract:

More Americans are uninsured because of the continued erosion in employer-provided health insurance, the most prominent form of U.S. health insurance. The number of people without health insurance grew significantly for the fifth year in a row. Nearly 46.6 million Americans were uninsured in 2005--up almost 7 million since 2000. The rate of those without insurance has grown 1.7 percentage points during this period, from 14.2% in 2000 to 15.9% in 2005. The percent of people with employer-provided health insurance also fell for the fifth year in a row, 4.1 percentage points in total. Over 3 million fewer people of all ages had employer-provided insurance in 2005 than in 2000 as a result of rising health costs coupled with weak labor demand. However, this decline does not take into account population growth. As many as 9 million more people would have had employer-provided health insurance in 2005 if the coverage rate had remained at the 2000 level.

Because of these large declines in employer-provided health insurance, workers and their families have been falling into the ranks of the uninsured at alarming rates. There were almost 4 million more uninsured workers in 2005 than in 2000. While uninsured workers are disproportionately young, non-white, less educated, and low-wage, workers across the socio-economic spectrum have experienced losses in coverage. Men lost coverage at nearly twice the rate of women, as did non-Hispanic whites over blacks. Even the most highly educated and highest wage workers had lower rates of insurance coverage in 2005 than in 2000.