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Employer-based health care coverage declines

Employer-based health care coverage declines

WASHINGTON—The percentage of the U.S. population covered by employer-based health care plans and the number of people covered by those plans fell in 2010, continuing a decadelong trend, the U.S. Census Bureau said in a report last week.

The percentage of people covered through employer-sponsored health care plans fell to a record low 55.3% in 2010. That's a drop from 56.1% in 2009 and continues a trend of annual decreases that began in 2001.

Correspondingly, the number of people enrolled in employment-based plans dropped to 169.3 million in 2010, down from 170.8 million in 2009.

Employment-based coverage peaked in 2000, when 181.9 million people were covered by employer-sponsored plans, according to the Census Bureau.

Still, last year's drop in employment-based coverage is much more modest compared with 2009, when employers laid off millions of employees during the peak of the Great Recession and others went out of business. The number of people covered by employer-sponsored plans fell by more than 7 million in 2009 compared with 2008, the biggest one-year decline in employment-based coverage since the Census Bureau began to compile such statistics in 1987.

The 2009 decline in employment-based coverage might have been even greater had it not been for a program Congress passed in February 2009 that subsidized COBRA health insurance premiums for terminated employees. Under that program, the government paid 65% of the COBRA premium for up to 15 months for employees laid off through May 31, 2010.

While employment-based coverage continued to decline, government-provided health care programs grew, though only modestly.

For example, the percentage of the population covered by Medicaid—the federal-state program for the poor—rose to 15.9% in 2010, up from 15.7% the previous year; the number of people enrolled in Medicaid increased to 48.6 million, up from 47.8 million.

While these figures are records, the one-year changes are not significantly different statistically, the Census Bureau said.

The percentage and number of people enrolled in Medicare also set records last year. In 2010, 44.3 million people were enrolled in Medicare, up from 43.4 million in 2009; the percentage of the population covered by Medicare increased to 14.5%, up from 14.3%.

Overall, the number of uninsured in 2010 rose to 49.9 million, up from 49 million in 2009. The percentage without coverage climbed to 16.3%, which was not a statistically significant change from the 2009 uninsured rate of 16.1%, the Census Bureau said.

The number of people with health coverage increased to 256.2 million in 2010, up from 255.3 million, which the Census Bureau said also was not a statistically significant change.

At 5%, Massachusetts had the lowest uninsured rate—averaged over 2009 and 2010—of any state, according to the Census Bureau.

That is the result of a 2006 law that created a program in which the state subsidizes health insurance premiums of the low-income uninsured, and imposes penalties on employers not offering coverage. The law also imposes assessments on individuals without health insurance coverage—except those who can prove that affordable coverage was not available and those who obtain special waivers.

After Massachusetts, Hawaii, at 7.5% had the second-lowest uninsured rate, followed by Minnesota at 8.9% and Wisconsin at 9.2%.

On the other hand, Texas had the highest uninsured rate of any state at 25%, followed by Florida at 21.3% and Nevada at 21%.

The 2010 federal health care reform law is supposed to make deep inroads in the number of uninsured, but the extension of federal premium subsidies to the lower-income uninsured to make coverage more affordable does not take effect until 2014.