The percentage of businesses offering health insurance to their workers has declined steadily over the last five years as the cost of providing coverage continues to outpace inflation and wage growth, according to the 2005 Annual Employer Health Benefits Survey released by the Kaiser Family Foundation (Menlo Park, California) and Health Research and Educational Trust (Washington).
The survey found that three in five firms (60%) offered coverage to workers in 2005, down significantly from 69% in 2000 and 66% in 2003. The drop stems almost entirely from fewer small businesses offering health benefits, as nearly all businesses (98%) with 200 or more workers offer such benefits.
"It is low-wage workers who are being hurt the most by the steady drip, drip, drip of coverage draining out of the employer-based health insurance system," said Kaiser Family Foundation President and CEO Drew Altman, PhD.
Premiums increased an average of 9.2% in 2005, down from the 11.2% average found in 2004. The 2005 increase ended four consecutive years of double-digit increases, but the rate of growth is still more than three times the growth in workers' earnings (2.7%) and 2-1/2 times the rate of inflation (3.5%). Since 2000, premiums have gone up 73%.
The annual premiums for family coverage reached $10,880 in 2005, eclipsing the gross earnings for a full-time, minimum-wage worker ($10,712).