September 2005

Surveys find fewer businesses offer health benefits, workers pay more premiums

The percentage of businesses offering health insurance to their workers has declined steadily over the last five years as the cost of providing coverage continues to outpace inflation and wage growth. And workers will probably be paying more for group healthcare, according to separate surveys.

The 2005 Annual Employer Health Benefits Survey released by the Kaiser Family Foundation and Health Research and Educational Trust found that three in five firms (60 percent) offered coverage to workers in 2005, down significantly from 69 percent in 2000 and 66 percent in 2003. The drop stems almost entirely from fewer small businesses offering health benefits, as nearly all businesses (98 percent) with 200 or more workers offer such benefits.

The Robert Wood Johnson Foundation surveyed more than 600 business owners and benefits managers whose companies currently pay for at least some health insurance benefits. Results show that companies of all sizes expect healthcare costs to jump an additional 12 percent over the next year.

“Attitudes of Business Leaders Regarding Health Care Coverage,” found that business owners say they will ask their employees to pay an average of 21 percent of the increase. Survey respondents estimate that their employees currently pay, on average, 29 percent of the cost of their own health insurance premiums — up six percentage points from 2003.

The Robert Wood Johnson Foundation survey underscores what some of the nation’s top business leaders, health policy analysts, and labor economists have been saying for many months: As the price of healthcare coverage continues to rise, fewer businesses, individuals, families, and government programs can afford to pay for coverage — and more Americans will be forced to go without health insurance.

According to numbers released last month from the U.S. Census Bureau, nearly 46 million Americans had no health insurance in 2004. The Census reported that the percentage of Americans who receive their health insurance from employer-sponsored coverage declined significantly between 2003 and 2004.

To help small business owners identify and evaluate their health coverage options, a free, downloadable resource, the Guide to Health Insurance Options for Small Business, is available at www.covertheuninsured.org The guide provides small business owners with key information on coverage — various plan options, tax advantages for providing employee coverage, tools to help estimate the cost of providing coverage, information on employee cost-sharing, and more.

The 2005 Annual Employer Health Benefits Survey is a joint project of the Kaiser Family Foundation and the Health Research and Educational Trust and is available at http://www.kff.org/insurance/7315/. The Robert Wood Johnson Foundation poll results can be found at www.covertheuninsured.org or www.rwjf.org.

Sources: Kaiser Family Foundation, .www.kff.org; Robert Wood Johnson Foundation, www.rwjf.org

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