November 2008 Scranton/Wilkes-Barre/Hazleton edition of The Union News

Pennsylvania workers losing employer paid health coverage

By PAUL TUCKER
theunionnewsswb@aol.com

REGION, October 13th- According to a study released by the Economic Policy Institute (EPI) in Washington DC and the Pennsylvania Budget and Policy Center in Harrisburg, only the state of Michigan saw a larger decline than Pennsylvania in the number of people covered by employers paid health insurance over the past six years. The organization released the study the same week the Pennsylvania Senate left Harrisburg without acting on a plan to expand options for the uninsured.

According to the the study, “The Erosion of Employer-Sponsored Health Insurance,” 70.2 percent of Pennsylvanians had employer provided coverage in 2006-2007, down 5.7 percentage points from six years ago. Nationally, the decline in employer coverage was 4.7 percentage points.

The study compared health insurance coverage rates in 2001, the peek of the last business cycle, to 2007 which is likely to be the peak of the most current expansion.

“The Senate walked away from a chance to solve what is clearly a deeping health care problem,” said Sharon Ward, director of the Pennsylvania Budget and Policy Center.

Pennsylvania is second to only Michigan in the loss of residents with health care coverge provided by an employer during the six-year period with 560,945 fewer state residents under employer policies in 2006 to 2007.

Pennsylvania also exceeded the national average of children losing employer provided health care coverage. Over the past six years 201,956 fewer children are receiving employer health care in the state, a drop of 7.0 percentage points, faster than the 5.6 percentage point national decline.

EPI economist Elise Gould concluded the decline of employer health care is likely to continue in 2008 with the downturn and faster than inflation health care cost increases continuing to drive up insurance rates and squeeze small businesses. “The health care problem has reached a critical level. Bold new solutions need to be considered to address the growing crisis,” Ms. Gould stated.

The EPI study found about 62.9 percent of Americans under age 65 were covered by employer provided insurance in 2007, which is more than 3 million fewer than in 2000. Also, since 2000, the number of uninsured workers has grown by 4.1 million workers. Around 45 million people under 65 are without health insurance coverage.

Between 2000-2001 and 2006-2007 the number of Pennsylvanians receiving employer provided coverage went from 7,929,984 to 7,369,039, a decline of 560,945. That was a decline of 5.7 percentage points among total number of workers receiving health care, from 75.9 percent in 2000-2001 to 70.2 percent in 2006-2007. Nationally, the decline of employer provided health care during that period was 4.7 percentage points among all workers, from 67.6 percent to 62.9 percent.

In 2001-2001, 82.5 percent of Pennsylvania workers were insured by their one employer, and in 2006-2007 it declined to 79.1 percent. The national average went from 74.4 percent in 2000-2001 to 70.9 percent.

In Pennsylvania the percentage of children under 18 obtaining their health care from their parents’ employers dropped by 7.0 percentage points between 2000-2001 and 2006-2007, from 74.3 percent to 67.4 percent. Nationally, there was a decline of 5.6 percentage points.

Overall among the 50 states and Washington, DC, Pennsylvania ranked 16th in terms of the percentage loss in employer provided health insurance, at 5.7 percentage points over the six year period.

The EPI critized the Pennsylvania Senate for not acting on a comprehensive plan to offer low-cost insurance to small businesses and individuals before they recessed to campaign for the November 4th election.

The proposal known as the Pennsylvania Access to Basic Care (PA ABC), would have offered a low-cost insurance option for small businesses not currently offering insurance to their employees and individuals who aren’t covered by an employer. The House of Representatives passed the legislation in March and had the support of Governor Edward Rendell.