Erosion Seen in Workers’ Health Plans
The number of workers in California and their families covered by job-based health insurance fell in recent years, but government programs filled in much of the gap, so that the number of uninsured statewide remained about the same, according to a UCLA study to be released today.
Adults covered by company-sponsored health insurance in the state fell 2 percentage points to 54.5% of the population from 2001 to 2003, while medical coverage for children dropped nearly 4 percentage points to 52.1% in the same period, the study found.
An estimated 796,000 Californians would have had health insurance through a job-based healthcare plan in 2003, but many could not afford to pay large increases for their share of the medical premiums, the study said.
“What we are seeing is a continuing erosion of employer-based health insurance, and it is hitting families especially hard,” said E. Richard Brown, one of the study’s authors and director of the UCLA Center for Health Policy Research.
Overall, the number of residents statewide younger than 65 without any public or private health insurance remained about the same at 6.6 million, according to the report.
The study surveyed 42,000 households throughout the state.
Some of the uninsured, especially children, are obtaining coverage through state programs such as Medi-Cal or Healthy Families, the study found.
“The consequence is that costs are being shifted from employers onto taxpayers,” Brown said.
Robert K. Ross, president and chief executive of the nonprofit California Endowment, one of the study’s sponsors, said, “We are seeing more and more middle- and low-income workers priced out of job-based health coverage each year because they can’t afford their share of the cost.”
Medical costs continued to soar. The required worker contribution for family healthcare coverage rose 79% to an average of more than $220 a month in 2003, according to the Kaiser Family Foundation, which was cited in the UCLA study.
Employee health benefits in California cost, on average, $3,685 for a single person and $10,013 for family coverage in 2004, UCLA said.
And next year promises more of the same for workers and companies. The cost of medical insurance to employers is expected to rise 12.6% on average in 2006, almost five times faster than inflation, according to a study released Monday by consulting firm Hewitt Associates.
As a result, more than 40% of employers are proposing to shift more medical costs to workers next year with higher deductibles and premiums, Hewitt said.
“Rising healthcare costs -- which have outstripped the ability of many workers and employers to afford health insurance premiums -- have been the major cause of a long-term decline in job-based coverage,” according to UCLA’s study
The report cited last year’s Southern and Central California grocery strike and lockout as an example of the trend of declining medical coverage for workers. As part of the strike settlement, supermarkets changed the rules so that new employees must work for 12 months before they are eligible for health insurance, and 30 months before their dependents are eligible.
In one bright spot, the study found that the number of children living below the poverty line in California without any kind of health insurance dropped nearly 7 percentage points, a result of them getting coverage through public programs.
