Most nonelderly Americans who have health insurance are covered through an employer, and employer-sponsored insurance (ESI) will continue to be a major source of coverage even after 2014, when the Affordable Care Act's (ACA's) Medicaid expansion and subsidies for the purchase of private coverage through health insurance exchanges will take effect. This report examines recent trends in ESI at the national and state level, and it expands and updates our previous analysis. ESI Coverage Rates. The percent of the U.S. nonelderly population with ESI declined from 69.7 percent in 1999/2000 to 59.5 percent in 2010/2011. While 47 states and the District of Columbia saw significant declines in coverage during this time period, there is substantial state-level variation in both the magnitude of these declines and in the absolute levels of ESI coverage in each state. The largest decline in coverage occurred in Michigan, which saw a 15.2 percentage point drop. Nebraska, on the other hand, saw the smallest statistically significant decline in coverage, dropping by 4.3 percentage points. Three states (Alaska, Massachusetts, and North Dakota) had statistically stable rates of ESI coverage. The share of the nonelderly population with ESI coverage ranged from a high of 73.8 percent in New Hampshire to a low of 48.0 percent in New Mexico (Table 1). Many factors contributed to the general decline in ESI coverage across the country and at the state level: decreases in overall employment levels along with decreases in the percentage of employers offering ESI (from 58.9% to 52.4%; Table 5); decreases in the percentage of workers employed at establishments offering coverage (from 89.3% to 85.9%; Table 5); decreases in the percentage of eligible employees taking up employer coverage offers (from 81.8% to 76.3%; Table 5); and decreases in the number of individuals enrolled in ESI as dependents (from 35.4% to 30.6%; Table 3). ESI Premium Costs. Nationally, the average total annual premium for single coverage more than doubled from 1999/2000 to 2010/2011, increasing from $2,490 to $5,081(Table 9). The average total premium for family coverage increased even more dramatically, jumping 125 percent, from $6,415 to $14,447 (Table 9). While the average employee share remained relatively constant for both single and family coverage between 1999/2000 and 2010/2011 (rising three percentage points for both types of coverage), the dramatic jump in total premium cost translated into a significant increase in the dollar amount of the average employee contribution to premium--from $435 to $1,056 for single coverage and from $1,526 to $3,842 for family coverage (Table 10). State Variation. At the state level, there is substantial variation in ESI prevalence, availability, and cost, due to variation in contributing factors such as employment characteristics (e.g., firm size, hours worked and labor force attachment) and population demographics (e.g., income distribution). Because of this inter-state variation, trends in ESI (including the impacts of the ACA) should be monitored and evaluated at the state level.
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