The NewStandard ceased publishing on April 27, 2007.

Employer-funded Health Insurance Continues to Drop, Study finds

by Brendan Coyne

Oct. 18, 2005 – Between 2000 and 2004, the number of companies providing health insurance to their employees dropped significantly, leaving fewer than 60 percent of people in the country insured by employers, according to a study released yesterday by a privately-funded think tank. The recent study confirms earlier reports from a variety of organizations.

According to the study by the Employee Benefit Research Institute, while the number of uninsured people in the US remained relatively stable at sixteen percent of the population, companies dropped a record number of workers from benefit programs since 2000. As a result, the percentage of US residents covered by employer-provided insurance decreased by four percentage points.

Additionally, the study found, the last time the percentage of people covered by employer-paid health coverage increased was in 2000, when the unemployment rate dropped to 4 percent. Currently, unemployment officially hovers around five percent, though many advocates for the poor and working class say the real number is much higher.

Many companies are offering reduced healthcare benefits to employees or yanking offers all together in the face of rising health-insurance costs. For middle- and lower-income people, healthcare costs loom as one of the biggest hurdles to economic self-sufficiency.

According to a September report by the Kaiser Family Foundation, health insurance premiums have been rising at rates much higher than inflation and wage gains for the past several years.

In August, the Center for Studying Health System Change projected that continued pressures on the nation’s safety-net system and a lack of government cost control regulations will lead to record rises in consumer healthcare costs.

According to a Health Affairs report earlier this year, more than half of people entering bankruptcy do so due to health care costs.

Both the poverty rate and rate of uninsured US citizens are on the rise, the Center on Budget and Policy Priorities found in August after assessing US census Bureau numbers.

"These findings are disappointing, as they follow three years of successive deterioration in health-insurance coverage," CBPP Executive Director Robert Greenstein said. "It is sobering that six million more people lacked health insurance in 2004 than in 2000."

The EBRI is financially supported by investor groups, insurance companies, manufacturers and other businesses.

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The NewStandard ceased publishing on April 27, 2007.


Brendan Coyne is a contributing journalist.

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