The ranks of Americans with employment-based health insurance declined by more than 2 percentage points in 2009, according to an analysis by the not-for-profit Employee Benefit Research Institute (EBRI). The report is published in the September 2010 EBRI Issue Brief.

EBRI’s calculations, based on U.S. Census Bureau data, show that employment-based coverage remains the dominant source of health insurance but continues to slowly decline. Overall, the percentage of individuals under age 65 with employment-based coverage fell to its lowest level in the 15-year period between 1994 and 2009.

The decline between 2008 and 2009 accelerated a long-term trend that has occurred during most years since 2000. Those under age 65 who did not have health insurance from any source increased to 18.9 percent in 2009, up from 17.4 percent in 2008.

“These trends are due to job losses resulting from the recent recession and the slow economic recovery, fewer workers being eligible for health insurance coverage, and more workers with coverage choosing to drop it,” said Paul Fronstin, author of the EBRI report. “With unemployment remaining high, these trends are almost certain to continue when the data are released for 2010.”

Fronstin noted that fewer individuals are likely to be working in 2010 (which means fewer with access to health benefits in the work place), and that federal COBRA subsidies that were meant to stem the erosion in employment-based coverage expired during the summer of 2010. “Coupled with uncertainty about the economy, the future of job security, and prospects for health reform, an increasing number of workers are likely to forego health coverage when it is available,” Fronstin said.

Separately, EBRI recently reported a drop in confidence among employed Americans in the future availability of employer-provided health benefits (see "Americans Worried About Future of Employment-Based Health Benefits").

EBRI’s estimates of the uninsured are slightly higher than those published by the Census Bureau because, unlike the census, EBRI counts only individuals under age 65. Medicare automatically covers those age 65 or over, so a more accurate measure of the uninsured excludes those with Medicare coverage, according to Fronstin.

Public Programs Growing

Among other key points noted in the EBRI report:

• Government-provided coverage is growing. Public program health coverage expanded as a percentage of the U.S. population in 2009, accounting for 21.1 percent of the nonelderly. Enrollment in Medicaid and in the State Children’s Health Insurance Program (SCHIP) increased, reaching a combined 44.1 million in 2009 and covering 16.7 percent of the nonelderly population, significantly above the 10.5 percent level of 1999.

• Individual coverage is stable. Individually purchased health coverage was unchanged in 2009 and has basically hovered in the 6 to 7 percent range since 1994.