Employer-Sponsored Insurance Under Health Reform: Reports of its Demise are Premature

The Urban Institute, January 2011

Posted: 20 Feb 2011

Date Written: January 15, 2011

Abstract

Some have argued that the Patient Protection and Affordable Care Act would erode employer-sponsored insurance (ESI) by providing incentives for employers to stop offering coverage. Others have claimed that most businesses would face increased costs as a result of reform. This study finds that overall ESI coverage under the ACA would not differ significantly from what coverage would be without reform. We estimate the average employer contribution per person covered by ESI would decrease by nearly 8 percent for small firms and would decrease slightly for larger firms. Total employer health care spending would be 0.6 percent lower under the ACA. We discuss several reasons why predictions of large declines in employer sponsored coverage are likely exaggerated.

Keywords: Employer, Sponsored, Coverage, Insurance, Health, Reform, PPACA, Patient, Protection, Affordable, Care, Act

JEL Classification: J11, J32

Suggested Citation

Garrett, A. Bowen and Buettgens, Matthew, Employer-Sponsored Insurance Under Health Reform: Reports of its Demise are Premature (January 15, 2011). The Urban Institute, January 2011, Available at SSRN: https://ssrn.com/abstract=1764287

A. Bowen Garrett (Contact Author)

Urban Institute ( email )

500 L'Enfant Plaza SW
Washington, DC 20024
United States

HOME PAGE: http://www.urban.org/BowenGarrett

Matthew Buettgens

The Urban Institute ( email )

2100 M Street NW
Washington, DC 20037
United States

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