Fewer Iowans getting insured through employer

Rising costs, more uninsured all factors in decline

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Iowa has more non-elderly residents obtaining health insurance through an employer than the nation as a whole, but those numbers are dropping, according to new industry report.

In 1999 and 2000, 1.92 million non-elderly Iowans — or 78.7 percent — were getting health insurance through an employer, according to a State Health Access Data Assistance Center report made public today. A decade later, in 2010 and 2011, 1.78 million non-elderly Iowans — or 68 percent — were getting insurance that way, according to the report that uses U.S. Census Bureau data.

When compared with many of the other states, Iowa has seen one of the bigger declines — with 10.7 percent fewer people getting coverage through their employers, the report shows.

“It is something that is a concern because, in a state where this has been such a strong pillar, you want to understand what’s going on,” said Julie Sonier, deputy director of the data assistance center, which is based at the University of Minnesota.

Reasons for decline

Several factors are at play, Sonier said. There have been declines in overall employment, drops in the percentage of employers offering health insurance and decreases in the percentage of workers employed at establishments offering coverage, according to Sonier and the report.

There also are fewer eligible employees taking up employer coverage offers and fewer people enrolled in employee health insurance plans as dependents, the report indicates.

“In Iowa, as is the case across the nation, we have seen increases in the number of people with public coverage,” Sonier said. “We also have seen a rise in people who are uninsured.”

The State Health Access Data Assistance Center is an independent health policy research center that helps states collect and use data for healthy policy.

The center’s report comes as the nation prepares for much of the Affordable Care Act to take effect in 2014. That measure will expand Medicaid and provide subsidies for the purchase of private coverage through health insurance exchanges.

The report indicates that most non-elderly Americans will continue to receive health insurance coverage through an employer — even after the Act takes effect. But reviewing the recent trend away from employer coverage is important in analyzing potential impacts, officials said.

“At the state level, it has an impact on the state budget,” Sonier said. “It’s a good thing for people to have private coverage rather than public coverage. Public coverage is intended for people who don’t have access to employee coverage.”

A rise in people choosing to go without insurance all together is a big concern in that they tend to avoid regular checkups and then access costly care later.

“Those costs are eventually passed on to people who do have coverage in the form of higher premiums,” Sonier said.

In Iowa, the average annual employer-sponsored insurance premium for individuals increased from $2,370 in 2000 to $4,591 in 2011. That’s a 93 percent increase and still the fifth lowest average single policy rate in the nation.

The rising cost of health insurance is one reason more employers are wavering on whether to continue offering coverage plans to employees, Sonier said.

Hard on businesses

Gary Ficken, owner of Bimm Ridder Sportswear, Inc., in Cedar Rapids, said he weighs the pros and cons of continuing his employee health insurance offerings every year.

“From a small business standpoint, my top troubling item would be the health care costs — no doubt about it,” Ficken said. “It’s not uncommon for a small business to see yearly increases of 20 percent.”

Ficken said he has to figure out how much of the insurance increases his business can absorb and how much to pass on to his 18 employees. He also has the option of offering workers plans that are less “rich.”

Bimm Ridder still is offering employees health insurance, and its employees — for the most part — still are taking advantage of it.

But, Ficken said, he learned Wednesday that his health insurance provider plans to charge Bimm Ridder an extra $5,400 in 2014 to help pay for the Affordable Care Act. That’s not an insignificant amount, Ficken said.

“If it’s $5,400 a year for us, think of what it is for Rockwell,” he said.

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