U.S. Employers and the Provision of Health Insurance to Employees

Employer-based health insurance is the backbone of the U.S. system of health insurance coverage. Yet it has been slowly eroding, and if these trends continue greater numbers of Americans are likely to be uninsured or without affordable coverage. Employer coverage has marked advantages, including benefits to employers and a natural risk pool that offers better benefits at lower cost than individual coverage, and is highly valued by employees. The shift of health care costs from employers who do not cover their workers to other parts of the economy is substantial. Very little attention has been given to policies that might strengthen and expand employer coverage. It will be important to shore up employer coverage both to curb its recent erosion and to build toward a more comprehensive system of health insurance. Employer-provided health insurance forms the backbone of the U.S. system of health insurance coverage. More than 160 million people, or 64% of the population under age 65, are covered under employer plans (DeNavas-Walt, Proctor, an