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Keywords:

  • Employer-sponsored health insurance;
  • offer rates;
  • take-up rates;
  • dependent coverage

Objective

To examine trends in employer-sponsored health insurance coverage rates and its associated components between 2000 and 2008, to provide a baseline for later evaluations of the Affordable Care Act, and to provide information to policy makers as they design the implementation details of the law.

Data Sources

Private sector employer data from the 2000, 2001, and 2008 Medical Expenditure Panel Survey-Insurance Component (MEPS-IC).

Study Design

We examine time trends in employer offer, eligibility, and take-up rates. We add a new dimension to the literature by examining dependent coverage and decomposing its trends. We investigate heterogeneity in trends by firm size.

Data Collection

The MEPS-IC is an annual survey, sponsored by the Agency for Healthcare Research and Quality and conducted by the U.S. Census Bureau. The MEPS-IC obtains information on establishment characteristics, whether an establishment offers health insurance, and details on up to four plans.

Principal Findings

We find that coverage rates for workers declined in both small and large firms. In small firms, coverage declined due to a drop in both offer and take-up rates. In the largest firms, offer rates were stable and the decline was due to falling take-up rates. In addition, enrollment shifted toward single coverage and away from dependent coverage in both small and large firms. For small firms, this shift was due to declining offer and take-up rates for dependent coverage. In large firms, offers of dependent coverage were stable but take-up rates dropped. Within the category of dependent coverage, the availability of employee-plus-one plans increased in all firm size categories, but take-up rates for these plans declined in small firms.