What's Happening?
The Employee Benefit Research Institute (EBRI) has released a report examining the current state of employer-sponsored health insurance in the United States. The report reveals that only 49% of employers are offering health benefits, with a significant
portion of these being large firms. Despite the commitment of large employers to continue providing health coverage, they are increasingly shifting costs to employees through higher deductibles, coinsurance, or more restrictive networks. This trend is particularly concerning for small businesses, which are increasingly unable to afford offering health benefits. The report highlights that while 70% of the non-elderly population was covered through employer plans between 1970 and 1989, this figure is projected to drop to 61% by 2024. The ongoing debate over insurance premiums, particularly in the context of the Affordable Care Act, has largely overlooked the rising costs in the employer-sponsored market.
Why It's Important?
The findings of the EBRI report underscore a critical issue in the U.S. healthcare system: the sustainability of employer-sponsored health insurance, especially for small businesses. As healthcare costs continue to rise, small businesses may be forced to drop coverage, leaving employees to seek alternatives or face increased financial insecurity. This shift could lead to a greater reliance on public health programs and exacerbate the financial burden on individuals. The report also highlights a potential gap in current healthcare policy discussions, which have focused on the Affordable Care Act's individual market, neglecting the challenges faced by employer-sponsored plans. The implications for workers are significant, as they may face higher out-of-pocket costs and reduced access to healthcare services.
What's Next?
If healthcare costs continue to rise, more small businesses may opt out of providing health insurance, potentially increasing the number of uninsured individuals. This could prompt policymakers to consider reforms aimed at stabilizing the employer-sponsored insurance market. Additionally, there may be increased pressure on large employers to find innovative ways to manage healthcare costs without further burdening employees. The ongoing debate over healthcare policy, including the role of the Affordable Care Act, may need to expand to address these issues comprehensively.
