Between 2000 and 2013, the fraction of private sector businesses offering employee health insurance declined from 59.3 percent to 49.9 percent, the Agency for Health Care Research and Quality estimates. While this decline was widespread, and can be seen across all nine major industry sectors – agriculture, fishing and forestry; construction; financial services and real estate; mining and manufacturing; other services; professional services; retail trade; utilities and transportation; and wholesale trade – it was greater at certain kinds of businesses than at others.
• Smaller Establishments Saw Greater Declines in the Tendency to Offer Employee Health Insurance. Between 2000 and 2013, the fraction of businesses with 10 or fewer employees providing worker health insurance declined from 39.6 to 28.0 percent, and the share of establishments with 10 to 24 workers providing coverage fell from 69.3 percent to 55.3 percent. By contrast, portion of business locations with 100 to 999 employees that offer worker health care coverage dipped slightly (from 95.0 percent in 2000 to 93.4 percent in 2013), while the fraction with more than 1000 employees that provide employee health insurance increased from 99.2 percent to 99.3 percent.
• Newer Establishments Experienced Larger Drops in the Provision of Employee Health Care Coverage. Between 2000 and 2013, the share of companies less than five years old offering employee health insurance declined from 36.8 percent to 23.0 percent; the fraction of companies aged five-to-nine providing coverage decreased from 46.5 percent to 32.7 percent; and the portion of businesses between 10 and 19 years old providing insurance went from 50.4 percent to 40.7 percent. However, the slice of businesses at least 20 years old making employee health care coverage available crept up from 70.5 to 71.0 percent.
• Incorporated Businesses Saw Bigger Declines in the Tendency to Provide Employee Health Insurance. From 2000 to 2013, the share of corporations offering employee health care coverage declined from 67.9 percent to 53.6 percent. By contrast, the fraction of unincorporated businesses providing employee health insurance increased from 33.5 percent to 35.5 percent.
• Single-Unit Establishments Experienced Larger Declines in the Provision of Employee Health Insurance. The fraction of multi-unit businesses offering worker health care coverage was virtually the same in 2000 and 2013 – 95.1 percent versus 94.3 percent. By contrast, single unit establishments saw their provision of employee health insurance drop from 47.1 percent in 2000 to 34.9 percent in 2013.
• The Decline in Employee Health Insurance Coverage Was Larger at Establishments with a Higher Fraction of Full-Time Workers. Between 2000 and 2013, the share of health-coverage-providing establishments with less than one-quarter of their workers present full time dipped from 21.2 percent to 19.2 percent. By contrast, the share of health-insurance-offering businesses with three-quarters of their workers employed at least 35 hours per week decreased from 66.9 percent to 57.9 percent.
• Higher Wage Establishments Saw Larger Bigger Declines in the Tendency to Provide Worker Health Insurance Coverage. Between 2000 and 2013, the share of primarily high-wage establishments (less than half of their employees were low-wage workers) that offered employee health care coverage fell from 64.7 percent to 56.0 percent. By contrast, the fraction of primarily-low-wage businesses (at least half of their employees were low-wage workers) that provided worker health insurance dropped from 42.5 percent to 37.1 percent.
• A Lesser Fraction of Union Shops Gave Up Employee Health Insurance. From 2000 to 2013, the fraction of businesses without union workers offering employee health insurance dropped from 58.4 percent to 46.0 percent. By contrast, the share of union establishments with health coverage decreased from 88.4 percent to 84.8 percent.
In short, the decline in the tendency of businesses to offer employee health insurance has been uneven in recent years. It has been concentrated in smaller and younger businesses, corporations, single establishment companies, workplaces without unionized workers, and companies with a lower fraction of low-wage and part-time workers.
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We cannot deny that health insurance will always be an expense. So businesses who are cutting on expenses will be less likely to offer it.