Pennsylvania Continues to Lead Nation in Lost Employer Health Coverage

November 16, 2010

Employers provided health insurance to 876,000 fewer Pennsylvanians in 2008 and 2009 than at the start of the decade, according to a new report analyzing U.S. Census data.

Only Michigan saw a larger decline in the number of people no longer insured by employer policies over the course of the decade, researchers with the Economic Policy Institute (EPI) found in the report, Employer-Sponsored Health Insurance Erosion Accelerates in the Recession.

Read a press release from the Pennsylvania Health Access Network and the Pennsylvania Budget and Policy Center providing more details on the Pennsylania findings.

Read a more detailed fact sheet on employer-sponsored health care in Pennsylvania.

While the recession-driven increase in unemployment contributed greatly to the growing number of people in the U.S. who lost employer-provided health care from 2008 to 2009, the erosion of employer-sponsored health care has been a decade-long trend, EPI researchers found.

As many as 25 million more people under the age of 65 would have had employer-sponsored insurance in 2009 if the coverage rate had remained at the 2000 level, according to the EPI report. The national rate of employer coverage plunged nearly 10 percentage points over the course of the decade - from 68.3% in 2000 to 58.9% in 2009.

In Pennsylvania, the number of workers and their dependents with employment-based health coverage fell from 7,929,984 in 2000-01 to 7,053,500 in 2008-09 – a decline of 876,484. The rate of employer coverage in the commonwealth dropped from 75.9% in 2000-01 to 67.6% in 2007-08 – outstripping the national average decline during that period.

The report analyzed U.S. Census Bureau data from 2000 to 2009. State-level data are averaged over two years to reduce sampling error.

Overall, Pennsylvania has a higher rate of employment-based coverage than the national average, the EPI report found. Among the 50 states and Washington, D.C., the Commonwealth ranked 11th in employer coverage rates in 2008-09.

Still, working Pennsylvanians are less likely to be insured by their employer today than they were eight years ago. In 2000-01, 82.5% of working Pennsylvanians were insured by their own employer, while in 2008-09, the rate dropped to 76.2% – a decline of 6.3 percentage points.

Pennsylvania also has seen a larger-than-the-national-average decline in the number of children covered by an employer policy. In 2008-09, 260,399 fewer Pennsylvania children were covered by employer policies than eight years before. Despite this decline, increased enrollment in Medicaid and the State Children’s Health Insurance Program compensated for much of the loss of employment-based coverage for kids - both at the state and national level.