Trends in Health Insurance Coverage : A Look at Early 2001 Data

Would employer health benefits have expanded even more than they did, if the cost of providing them were not rising much faster than inflation?Between the late 1980s and mid-1990s the percentage of Americans without health insurance coverage rose, in large part because rising health benefit costs eroded employment-based coverage. Recent data suggest that the strong economy of the past decade has greatly affected various aspects of health benefits. Since the mid-1990s the percentage of workers and their families with employer coverage has been increasing, and between 1998 and 1999 the percentage of all Americans without health insurance actually fell. Despite cumulative cost increases of nearly 20 percent between 1998 and 2000 for small employers, the percentage offering health benefits rose substantially during the same period. Many who support coverage expansion fear that without a strong economy, rising insurance costs will have their expected effect on coverage patterns — namely, the number of uninsured persons will soon start to rise once again.Using nationally representative data from early 2001, this paper examines the state of employment-based health benefits among workers and how it has changed since 1993. Data from 2001 may shed light on whether the weakening economy has started to affect U.S. health insurance coverage