Snapshot: Employer-Based Insurance: Coverage and Cost
Christine E. Eibner, Kanika Kapur, and M. Susan Marquis of RAND
June 2006
The cost of health insurance remains a perennial preoccupation of employers, employees, and policymakers. About two-thirds of California businesses offer health insurance to at least some workers as a benefit of employment. These businesses account for 89% of California workers.
This report, Employer-Based Insurance: Coverage and Cost, provides an overview of the employment-based insurance landscape. It addresses a range of issues, including how costs are distributed; which types of employers offer coverage; the number of workers enrolled; and how employer premiums vary among offering businesses. It also examines how employer costs would change if every business provided coverage for all full-time workers.
Among the findings:
- Significant variation exists in employer premium contributions as a share of payroll — ranging from less than 4% to more than 15%.
- For employer-sponsored health coverage, the typical enrollee pays about 1.5% of annual income. Low-income workers, however, pay almost three times that.
- Expanding employer-sponsored coverage to cover all full-time workers in California would produce new costs for more than half of businesses.
The analysis is based on 2003 data from several sources and represents all private businesses with workers in California. The complete report is available under Document Downloads.