the urban institute how have employers responded to health reform in massachusetts? evidence from...
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THE URBAN INSTITUTE
How Have Employers Responded to Health Reform in Massachusetts?
Evidence from the Perspective of Employees
Sharon K. LongUrban Institute
Alliance for Health ReformNovember 7, 2008
2 THE URBAN INSTITUTE
Early Impacts of Health Reform on Individuals in the State
• Uninsurance among working-age adults reduced by almost half, with no evidence of any crowd-out of ESI coverage
• Improvements in access to health care
• Reductions in the costs of health care to consumers
• Improvements in the financial protection provided by insurance as underinsurance has declined
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Focus of this Study: Employer Responses to Health Reform from the Perspective of their Workers
• Employers could decide to stop offering coverage or tighten eligibility for coverage
• Employers could shift more of the costs of coverage onto workers
• Employers could scale back the scope of coverage that they offer
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Data and Methods
• Data: Massachusetts Health Reform Survey
– Fielded in Fall 2006 and Fall 2007
– Sample sizes ~3000 in each year
• Sample: Working adults 18 to 64 years old
• Methods: Compare workers in Fall 2007 to workers in Fall 2006
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No change in the share of workers in firms that offer ESI coverage to any workers
90%91%
72%76%
96% 96% 98% 98%
0%
20%
40%
60%
80%
100%
Fall 2006Fall 2007
Are employers dropping coverage?
All workers
Firm size< 51
Firm size51 - 1000
Firm size> 1000
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No change in the share of workers in firms that offer ESI coverage to them
80% 80%
59%60%
88% 88%91% 91%
0%
20%
40%
60%
80%
100%
Fall 2006Fall 2007
Are employers tightening eligibility for coverage?
All workers
Firm size< 51
Firm size51 - 1000
Firm size> 1000
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No change in the share of part-time and short-tenure workers in firms that offer ESI coverage to them
80% 80%
57% 57% 57% 58%
0%
20%
40%
60%
80%
100%
Fall 2006Fall 2007
Are employers tightening eligibility for coverage?
All workers
Part-time worker
Worker with job tenure < 1
year
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No significant increase in the share of workers with ESI premiums above $1000/year for single or $3000/year for family coverage
48% 49%46% 46%
51%55%
47% 48%
0%
10%
20%
30%
40%
50%
60%
Fall 2006Fall 2007
Are employers increasing workers’ contributions toward ESI premiums?
All workers
Firm size< 51
Firm size51 - 1000
Firm size> 1000
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No significant increase in the share of workers with ESI premiums above $1500/year for single or $4500/year for family coverage
27% 26%
32% *
24%
29% 27%
22%
27%
0%
10%
20%
30%
40%
50%
60%
Fall 2006Fall 2007
Are employers increasing workers’ contributions toward ESI premiums?
* Difference is significantly different from zero
All workers
Firm size< 51
Firm size51 - 1000
Firm size> 1000
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Workers’ rating of range of services, choice of providers and quality of care under ESI plan remained high
63%67%
69%73%
69%72%
0%
20%
40%
60%
80%
100%
Fall 2006
Fall 2007
Are employers reducing the scope of ESI coverage?
Rates range of services as very good or excellent
Rates choice of providers as very good or excellent
Rates quality of care as very good
or excellent
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No evidence that ESI plans are covering less of the costs of health care
15% 15%
14%13%
0%
10%
20%
Fall 2006Fall 2007
Are employers shifting more of the costs of care onto workers?
Expensive medical bills not
covered by ESI
Doctor charged more than ESI
plan paid
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No evidence that workers with ESI coverage are spending substantially more on health care
48% 46%
15% 15%
0%
20%
40%
60%
Fall 2006
Fall 2007
Are employers shifting more of the costs of care onto workers?
OOP health care costs $1000 or
more/year
OOP health care costs $3000 or
more/year
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Lessons at the End of One Year
• ESI coverage continues to provide a foundation for health reform in Massachusetts
– Employers are continuing to offer ESI coverage
– Employers are not requiring higher contributions toward ESI premiums from their workers
– Employees continue to report high levels of satisfaction with their ESI coverage
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Looking to the Future
• These findings provide early evidence on the response by employers to health reform – Individual mandate not in place at time of 2007
survey
– Small firms, in particular, may be slow to adapt to changes in the health care environment
• New round of the survey is in the field now